Foreign Exchange Prime Brokerage is a service offered by hedge funds, investment companies, commodity consultants and other investment and trading groups in large foreign exchange transactions. The concept of prime brokerage began in the equity and bond markets; The prime brokerage idea was adapted to the foreign exchange world in the early 1990s and has since become a standard in the industry, particularly for hedge funds and investment firms. Because the code deals with almost every aspect of a market player`s participation in wholesale foreign exchange markets – for example. B in the areas of ethics, governance, enforcement, information exchange, risk management and compliance, auditing and settlement – even code principles that are not specifically aimed at primer brokerage could have an impact on first-class brokerage transactions, and premium brokerage participants may want to assess the impact of the code as a whole. Issues of potential interest not addressed in this legal update include, among others, brands, order processing, clear communication of a participant`s ability to act, handling confidential information, advance warranty and “last look,” a topic on which GFXC is currently seeking feedback.8 Competition between FX Prime brokers to secure most volume program vendors is intense. , so the fees for this particular segment of customers have dropped dramatically. In simple terms, the foreign exchange market is much more accessible and spreads are narrower than ever. This is good news for the currency manager or program trader, who is highly specialized and focuses on a particular segment. However, most other managers run complex cases and therefore need a higher level of service.
As most full service premium brokers know, you need to be able to use the client on multiple levels. This means that we have to satisfy everyone, from the CEO to the IT department, to the customer administrators. Everyone in the client organization has a say in whether the first broker provides a top-level service. Principle 41 of the code is dedicated to the promotion of real-time monitoring by all the first participating trading and credit brokers for first brokered transactions. After Citi made high-frequency trading in June, some banks jumped at the chance to do new business, but HSBC was cautious. Gemma Laman, the bank`s head of forex sales, says the new opportunities are in hedge funds and asset management. As the only Nordic premium fx broker and one of the world`s leading suppliers of OPCVM III, we allow our clients to trade with multiple counterparties or DEA, as well as offer several master-agreements with many exporting brokers.