All-to-all marketplaces gain traction in FX
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Foreign Exchange

All-to-all marketplaces gain traction in FX

Is the CME’s new spot FX marketplace further evidence of the trend towards futures and options trading, and away from private deals?

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Illustration: iStock

Earlier this month, CME announced plans to launch CME FX Spot+, an all-to-all spot FX marketplace connecting cash market participants with the company's FX futures liquidity.

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Paul Houston, CME

Paul Houston, global head of FX products, says the new marketplace (to be made available for client testing during the second half of next year) would increase access, transparency and trading opportunities across spot FX and FX futures markets.

The all-to-all spot FX marketplace concept has been in the works for the last decade or so, and it is perhaps surprising that it has taken CME so long to come to market with a solution.

One possible answer is that despite early predictions that all-to-all would come to be the dominant trading environment, this has not turned out to be the case – or at least, not yet.

“There are suggestions that FX as an asset class has seen significant growth in on-exchange trading volumes recently and a shift away from its historical over-the-counter-heavy environment,” says David Morrison, senior market analyst at Trade Nation.

Preferences

FX trading volumes continue to grow year on year, despite a brief dip in 2015/16 linked to the Swiss National Bank’s shock decision to drop its target floor against the euro.


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