This day in history: September 30, 2009 – Integral begins to offer brokers direct access to interbank FX market

Six years ago today, the world’s retail FX brokerages were beginning to set their sights on emulating the institutional and proprietary trading floors of the world’s major financial centers by shifting from a closed system in which all orders were executed via an internal desk, the modus operandi for which the MetatTrader 4 platform was originally designed, to a direct market access model, which was facilitated by a series of specialist software developers that were established around that time in order to provide liquidity bridges and price feeds to retail firms via the very same MetaTrader 4 platform that had gained ubiquity by the end of the last decade.

Thus, on September 30, 2009, Integral Development Corporation began to provide direct market access to the interbank FX market by offering retail brokers dealable liquiity and free market data on a historical and real time basis via its TrueFX service.

The Californian company noted at the time thata dramatic shift in how FX market participants gain visibility into interbank FX rates and obtain market data, stating that by increasing transparency and auditability for everyone, Integral Development Corporation predicted the emergence of a safer and more predictable market which would open up opportunities for greater market participation globally.

The company built this new solution based on its FX Grid product, Integral’s global inter-institutional connectivity and trading network, linking market making banks to FX market participants, TrueFX is live and in production today. On the portal site TrueFX.com, Integral had began to publish tick-by-tick historical and real-time market data free of charge to all market participants.
As a result, users of the service began to receive access to clean, aggregated, dealable bid and offer prices direct from leading market makers.

Making a statement on this dynamic back in 2009, Integral Development Corporation’s CEO Harpal Sandhu, who remains CEO to this day, stated “Once the query-based search is implemented, anyone will be able to spot check individual trades they executed, and compare the rate they got from their institution to that of the multi-source liquidity feed.”

“TrueFX is a paradigm shifting event that will change the way foreign exchange markets are organized. By providing clean, dealable prices supported by free real time and historical tick-by-tick data, we believe the overall confidence in the market will increase, which in turn will lead to much greater market participation” he concluded.

“The FX market has developed into a loosely integrated set of decentralized markets,” said Larry Tabb, Founder and CEO, Tabb Group at the time “For the FX market to reach its true potential, we will need to lower entry barriers, reduce cost, eliminate friction, increase transparency, and most importantly increase the safety for retail traders. This will open the FX market to a wider array of participants and expand the market dramatically” he enthused.

Launched six years ago, features of TrueFX included facilitating a “No Dealing Desk” operation, back-to-back cover trading, integration with prime brokers, a netting facility for high-volume small-size tickets, and customer account segregation capabilities.

Names which have now long since been consigned to the history books were original supporters of the TrueFX initiative, including ODL Securities, a British spread betting company that was purchased by FXCM shortly afterwards, and PFGBest, which went to the wall at the beginning of this decade, during the period at which the United States authorities began an overhaul of how firms in its region operate with specific attention to their capital bases.

At the time of launch in 2009, Integral Development Corporation explained that it had been working on making historic tick-by-tick bid-offer data available, eventually going back to early 2008.

While data was initially presented for download only, the system subsequently began to allow for specific queries. “Access to clean historical data is especially appealing to algorithmic trading venues as they are looking for ways to test and refine their trading strategies,” added Mr. Sandhu. “Once the query-based search is implemented, anyone will be able to spot check individual trades they executed, and compare the rate they got from their institution to that of the multi-source liquidity feed.”