How can third party data be used most effectively to react to market shifts?
Market volatility and the continuously changing regulatory environment demand faster response to client needs. Access to high quality data is crucial but thanks to innovation and AI we are now able to enhance foreign exchange trading workflow in a most efficient way. Auto execution RFQ trading is one solution to ensure speed of execution in stressed market conditions with the benefit of better serving the clients while meeting compliance requirements to ensure high quality of execution. Human capital remains highly valuable and being able to leverage automation coupled with human insight can have a huge value add.
How can this process be improved?
It is important to keep auto execution RFQ trading agile and dynamic by continuously analysing data quality and revising from time to time the eligibility criteria adopted to ensure they still meet clients’ needs and best execution requirements as defined by the regulator. A flexible approach allows to fully exploit and benefit from the innovative service offered by trading venues and liquidity providers.
What still needs to be done to optimise automated trading in FX?
The FX market has been slower to adopt the benefits of automation compared to other asset classes. One step towards optimisation is to digitalise the whole onboarding process. Data sources and access for regulatory and compliance checks are not always straightforward to retrieve and this affects the speed of the overall process.
Which FX instruments remain the least automated and why?
FX derivatives as they require large pre-trade data analysis. Thanks to AI, we now manage onboarding related data in a more efficient and precise way to properly feed our OMS and auto-execution tools.
We are keen to include FX derivatives among our automated FX workflow to offer the same level of innovation we deliver on other asset classes. Beside our natural attitude towards the most technological and recent tools alongside our natural inclination towards the most technological and recent tools, it is crucial for us to be able to properly monitor the risk embedded within them and the quality of execution in the interest of Generali Group and clients.
How do you expect the global macro environment to continue to impact the FX liquidity landscape?
Innovation across the whole financial market is a matter of fact with its impact perceived across asset classes. As part of the ongoing process, I do expect FX to consolidate the current transition toward greater automation in the future, deploying high-performance workflow tools which can strengthen efficient data sources and support even more complex analytics. Though it is key to have human capital with an innovative mindset to keep pace with industry developments.