This morning marked opening of the Euromoney FX survey, and we need you to get voting. The polls are open for six weeks – but that is not long.
It hasn’t been a dull 12 months. Volumes are probably only slightly up on last year: after a reasonable start – April and May were especially busy – but then the summer was very quiet indeed. Then we had the currency-wars rhetoric, and QE II came centre stage, lifting volumes again.
Regulation has been the biggest topic, as it will be again this year; the extent to which FX will be forced into a CCP-model is still uncertain. Regulatory compliance will take its share of the technological budget, especially as those at the front of e-commerce strive to maintain their positions and those behind played catch-up. The contest between single- and multi-bank platforms continues to be played out, but this year there may be an added frisson of excitement – particularly for forward FX – about which multi-bank platforms qualify as swap execution facilities. Firms on the sell side will carry on trying to differentiate themselves by focusing on research and recruiting FX strategists. When it comes to profits, however, FX numbers tend to be kept quiet; when they are released, they are often shrouded under the FICC umbrella. While a number of major players are claiming record-making volumes, that doesn’t necessarily translate into greater profitability as spreads have continued to compress and hedging has favoured simple over complex structures.
All of which brings us back to the survey. We will see in May if the leading group has broken away or if the chasing pack has managed to peg them back; which banks have spent wisely on front-end upgrades; who is falling by the wayside in the battle of the platforms; whether or not lower option volumes have meant the bulk of the business is now in the hands of an even smaller few; and who now has the best research offering.
All this depends on price users taking the time to vote, and six weeks goes very quickly. So get yourself over to vote as soon as you can.