EuroMoney 2018 FX Survey…Go XTX!

EuroMoney 2018 FX survey results released this week show JPMorgan are for the first time #1 in FX, but the real story is the absolutely astonishing performance from XTX Markets, now ranked #3 in global FX.

XTX Markets are the definitive ‘non-bank market maker’ (NBMM), using sophisticated  models and the latest technology to finely calibrate and distribute pricing, enabling them to more effectively manage liquidity to multiple electronic platforms, trading venues and directly to banks, acting as liquidity providers to ‘the liquidity providers’. The picture below is the entrance to the new XTX Markets London offices, a far cry from an investment bank!

XTX Markets recently left London's upmarket Mayfair neighbourhood for a new home in King's Cross, an area fast becoming one of the UK capital's main technology hubs.<br> The market-maker was spun out of the quantitative hedge fund GSA Capital in 2015 and <a href="https://www.fnlondon.com/articles/electronic-trader-xtx-prepares-to-compete-in-equities-20171002" target="_blank" class="icon none" >has been doing rather well since</a>. Initially focused on foreign exchange, XTX has been expanding into new asset classes, growing headcount and <a href="https://www.fnlondon.com/articles/xtx-warns-mifid-risks-spreading-fx-bad-habits-to-equities-20170727" target="_blank" class="icon none" >making its opinions known on the future shape of financial markets</a>.<br> After launch, the firm appointed the design specialists at Peldon Rose to kit out a 22,000 square foot office in King's Cross — a job that has now been completed.<br> <em>Financial News</em> got the tour of the Sci-Fi and mathematics-inspired workspace.

As banks continue to be challenged by higher regulatory capital requirements, lower risk appetites and reduced leverage ratios, firms such as XTX and other NBMM including Jump Trading, Citadel and Virtu Financial have been increasingly stepping in to fill the gap.

XTX is co-run by Zar Amrolia, who was until 2015 the Global Head of FICC at Deutsche bank. Which under his watch developed the Autobahn FX platform which powered Deutsche Bank to #1 in FX from 2005-2013, with peak market share of 21% in 2008, as shown in the chart below, whereas now they are #8 with share of 5.4%

I met Zar back in 2015 when he just joined XTX, and he told me then that his mission to make the firm a #3 FX liquidity provider….he took his time!

Here is a summary of the top 20 FX bank by market share.

 

About Paul Blank

A career working in financial markets. Early career as an FX Trader, before moving on to e-Trading platforms and Fin-Tech solution providers. This blog looks at how evolving regulatory landscape impacts market participants across the capital markets, e-trading platforms/venues.
This entry was posted in FX Survey, liquidity, regulation. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.