360T launches FX Swaps mid-market trading via API

Rick Steves

“Trading FX Swaps via API and executing at mid can deliver significant benefits. The ability to auto price FX Swaps offers more efficient execution for our clients while enabling us to hedge our own risk better, and we’re delighted to now be deploying this technology.”

360T has announced the launch of streaming mid-liquidity via APIs on its Swaps User Network (SUN), a significant milestone for the FX Swaps segment.

Deutsche Bank and ING executed the initial trade in a first for both banks, which were able to trade FX Swaps via API and match at the market midpoint, marking a paradigm shift for the industry.

360T SUN is currently the only platform that offers a continuous streaming mid-price for FX Swap instruments.

Ability to auto price FX Swaps offers more efficient execution

Shuo Wu, Global Head of Forward e-Trading at Deutsche Bank, said: “Establishing a marketplace that facilitates risk offset at the mid—market level signifies the next phase in the advancement of FX swaps trading. This development finally delivers for the industry opportunities that have long been present in smaller markets, and empowers us to better cater to the rising client demand for access to these products.”

Simon Bevan, Head eFX Trading at ING, commented: “Trading FX Swaps via API and executing at mid can deliver significant benefits. The ability to auto price FX Swaps offers more efficient execution for our clients while enabling us to hedge our own risk better, and we’re delighted to now be deploying this technology.”

Simon Jones, Chief Growth Officer at 360T, added: “We’re confident that this will mark a fundamental change in how banks trade FX Swaps, opening the door to auto-hedging, aggregation and even algorithmic execution. 360T SUN will ultimately allow our bank partners to better service their clients and enhance their own trading capabilities while unlocking further growth in the FX Swaps market.”

A deeper look at 360T SUN

360T enables buy-side firms to optimize their entire FX trading workflows, helping them to reduce their execution costs and operational risks across the entire trade life cycle while enhancing compliance functions and transparency at the same time.

Regulated by the German BaFin and offering access to regulated trading environments via its Multilateral Trading Facility (MTF) and Swaps Execution Facility (SEF), 360T provides a link to a broad array of liquidity from more than 220 liquidity providers and is connected to more than 2,400 buy-side firms globally.

360T SUN is a fully automated FX Swaps limit order book with a mid-rate matching capability supported by an automated bilateral credit model. It addresses the fact that vast swathes of the $3.8 trillion of notional FX Swaps volume traded each day is executed via manual channels which can be inefficient, opaque, not cost-effective and introduce operational risk into the trading process.

The order book offers price transparency through an indicative streaming independent mid-market rate which allows users to submit interest to buy or sell with intent protection. Neither the size, nor the direction of the order intent is visible within the mid-book.

360T SUN is available to traders through the 360T HTML GUI, while e-FX desks can also connect electronically via FIX API, allowing both streaming prices to the limit order book and midrate interest to be placed.

In offering API trading 360T SUN opens up the door for streaming prices and auto-hedging, enabling e-FX desks to take on the risk and execution of FX Swaps. By giving banks the ability to design hedging mechanisms and automatically utilise order types that have long since been available to Spot FX traders, we’re enabling them to essentially build out a new business of auto-hedging Swaps.

While credit has historically been a barrier to FX Swaps automation because it required manual processes, 360T SUN solves for this by offering a granular low latency pre-trade credit check tool that can be maintained manually or via REST API. This tool allows users to manage their risk through six different risk methodologies, enabling them to build either a simple or complex ruleset which determines how their credit is applied. 360T SUN also provides simple API connectivity to sell-side firms’ own credit engines.

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