Cboe reports highest ADV for FX volume in two years

abdelaziz Fathi

Cboe’s institutional spot FX platform today announced its trading volume for the month ending September 2022, which marks its third-highest month ever.

Cboe

Cboe FX disclosed a total trading volume of $1.008 trillion, up 18 percent on a month-over-month basis from $854 billion in August‎. This figure is the second best reading for the exchange’s monthly turnover since it hit a record peak in September 2020 at $1.20 trillion. In addition, it was higher by a third year-over-year when weighed against $754 billion in September 2021.

The exchange’s institutional FX trading venue saw its average daily trading volumes amounting to $45.8 billion in September 2022, up 23 percent month-over-month from $37.1 billion the previous month. The ADV figure was also the highest since September 2020 when it hit $55 billion.

On a year-over-year basis, the ADV numbers released by Cboe FX, formerly Hotspot, illustrated stronger performance, rising by 34 percent when weighed against $34 billion a year earlier.‎

Cboe FX saw a sizable increase across its total trading volumes amid coronavirus-driven volatility that has shaken awake previously slumbering FX markets. However, activity at major institutional ECNs has been consolidating in the third quarter as intense chaos triggered by the Russia-Ukraine crisis lost some steam.

Cboe widens FX market share

Cboe’s foreign exchange franchise saw its market share at a new all-time high of 17.0 percent. During the period, the demand for Cboe’s versatile products had been revived by concerns over the COVID-19 pandemic and uncertainty surrounding the FED’s policy even as it drove many investors onto the sidelines.

Recently, Cboe FX Markets teamed up with XTX Markets to launch a hosted algorithmic execution service. The connection between the London-based market maker and Cboe comes as algo trading as an execution strategy gains popularity with FX traders.

XTX Markets’ Execution Algo now enables Cboe FX users to benefit from its implementation shortfall execution algorithm, which aims to reduce slippage to arrival price. The institutional FX venue has also secured exclusive rights over use of the XTX Algo in the anonymous ECN space.

Cboe also completed the technology migration of Canada’s largest dark pool stock trading platform, MatchNow, which was acquired in 2020 from Virtu Financial for an undisclosed price.

We caught up with Ben Leit, global head of FX & FI sales at Cboe, to uncover emerging trends in the FX industry and learn more about the bourse operator’s recent initiatives.

 

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