EMS survey highlights FX traders’ platform predicament
A reluctance to dispense with legacy technology, combined with heightened regulatory oversight and changing liquidity provision from banks, has seriously complicated the execution management system (EMS) selection process for FX traders.
Among their priorities was more front-to-back and multi-asset integration in the next generation of platforms, as well as more open architecture.
Vendors of platforms play an important role given the trend towards buy rather than build on the buy side. Only 7% of respondents to the survey Global Pulse: FX Platforms reported using an in-house platform.
Front-to-back and multi-asset integration would clearly be useful, but is not without complications.
The use of a single system would be likely to increase the number of workarounds and daily operational challenges faced by traders and middle office due to technological compromises made in trying to be a one-size-fits-all solution.
The risks of implementing a replacement front-to-back infrastructure in a ‘big bang’ manner are just too high for most businesses to contemplate - Simon Wilson-Taylor, EBS Institutional
It is difficult for any vendor to be best of breed across the whole investment lifecycle from front to back, or across all asset classes horizontally.