Increased Electronic Trading in Futures Means Major IT Upgrades Needed
As more and more buy-side firms take advantage of electronic means for trading, whether that means routing orders through direct-market access (DMA) solutions or algorithmic-trading options, that has meant that both brokers and third-party trading platform providers have had to upgrade their offerings as well.
As noted by a report put out by Tabb Group earlier this year, nearly 90 percent of all US buy-side firms are expected to route their futures trades through electronic channels in 2012.
I spoke last week Allen Zaydlin, the chief executive of electronic trading technology InfoReach, which unveiled its enhanced trading platform yesterday. He says that clients have been asking for more functionality in order to trade in complex order types, where the clients rolls up two, three or even four legs of futures trades into one transaction.
As a result of brokers creating and supporting more types of algorithms, InfoReach expanded its InfoReach TMS and InfoReach Prelude trading platforms to provide FIX-based multi-leg order capabilities for cross-asset derivative futures contracts and options trades.
"Our additional FIX functionality is a reflection of this demand in the market," he says.
As the demand for capabilities to expand into complex strategies such as multi-legged spread trades through electronic means increases, this will also invariably create new opportunities and challenges for third-party providers to keep up with these new client-led desires.
How has your company had to either upgrade or completely replace its systems as the 'electronification' of the futures and options market has expanded? And what new challenges do you see resulting from this expansion as we head into 2013?
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- InfoReach TMS Expands Global Trading Connectivity Network
- InfoReach presents enhanced electronic trading platform risk controls