For Sale: Most of the big Tier 1 FX dealing offices!

Will you move in and live in a dealing room whilst Tier 1 FX dealers stay at home? It is very likely. Here is our candid research

Over four months have passed since the majority of the world’s workforce in every industry sector has not been allowed to go to the usual place of employment.

Due to draconian and dictatorial government rulings in all nations globally with the exception of Sweden, a nation which once again shows its absolute brilliance, hundreds of millions of hard working people worldwide have lost everything they have ever worked for, with the more fortunate among the workforce having resorted to working from home.

Working from home has now become such an ingrained habit among the vast majority of employees of large companies, in many cases including people who have never worked from home before, that it could be said that the past few months have represented a trial period by employers as to whether having a workforce that commutes to an office is actually an effective means of conducting business, or whether it is expensive, resource hungry and time inefficient.

Given that these absurd and quite clearly premeditated lockdowns may well return and return over and over again, it is prudent for companies to decide whether working from home is now such a feature that it can be done permanently.

Last week, FinanceFeeds met with a large property development and estate management company in London which leases commercial office space to companies in the financial markets industry and its associated technology sector.

The general consensus was that most commercial real estate managers are now looking to move their business from the core activity of leasing office space to Tier 1 FX dealers, technology firms, research and data providers and liquidity companies, instead focusing on working with construction firms to convert these office spaces into residential apartment buildings.

“Yes, some of the key employees of banks, including dealing desk operatives and traders have been quietly going into the offices over the past few months and executing business because that is where the connectivity is and they need to have their office based infrastructure in place, however the majority of offices in the Square Mile and in Canary Wharf have been empty for months, and it is likely that they will remain so, as the financial sector has not seen any downturn in activity or efficiency with its staff working from home compared to in the office” said a contract manager for a commercial leasing company here in London.

It is clear that whilst some people took longer to get used to working from home – there will always be those who are tempted to go for a motorcycle ride, or clear out their garage, or spend 2 hours sunbathing under the placebo of telling their employer they are ‘working’ from home, but generally speaking, the shift toward having entire workforces working remotely is more of an infrastructural challenge than a behavioral one.

Just ten years ago, it would not have been at all feasible to have the entire staff of the world’s largest institutions whose single dealer platforms are creating and moving all of the world’s global markets. Trading infrastructure was far more reliant on physical hardware back then, but nowadays that is just not the case.

For a few thousand dollars per month, companies can lease dedicated points of presence which are activated via a few settings and used via a standard digital subscriber line, whereas a few years ago that would have been a complex infrastructure architecture project for large financial telecoms and connectivity firms such as TMX Atrium, a massive participant in the early Millennial years, but where are they now?

During my apprentice program at BT Radianz (It was BT Financial Technologies in those days, before the Radianz acquisition) everything was reliant on physical cabling, PBX switches and on site IBM Middleware servers, later giving way to NT4 farms. This meant that not only did traders have to be onsite all the time, but so did we, and so did Price Waterhouse Coopers, Accenture, Steria, EY and many other tech outsourcing professional services companies.

Those days are gone now. Trading even at single dealer platform level can be done from home. The only major issue is latency caused by the obvious need for extreme internet firewall and cyber security systems due to bank trading being conducted from the living rooms of its employees.

That may sound daunting, but it should not be. Accenture, Intel and Salesforce are just some examples of the customer facing software (Salesforce) and trading infrastructure (the big four, particularly Accenture) outsourcing firms that have been working with the City’s large companies on huge internet security projects, all of which are deployable and manageable from home.

FinanceFeeds has spoken to many senior executives in these capacities recently, mainly those who oversee such projects at large consultancy firms, and all have been working from home, deploying security systems into banks which are location agnostic, meaning that it does not matter who is working from home or at the office, the system operates identically.

London will always be the world’s number one financial markets center, however its position may become even more elevated now, considering the absolute decimation that the closedowns have caused in North America, and with the quite well founded suspicion and trepidation that the Communist Far East (including Singapore and Hong Kong) is now being viewed, and the investment in infrastructure for the UK has been at the top of the tree for decades.

Since the 1980s, over 5000 miles of fiber optic cabling has existed which goes under the North Atlantic and into the United Kingdom at Highbridge in Somerset, which carry financial markets transactions from London and its hosted sites (Equinix LD4 in Slough) and dedicated onsite bank owned sites in Central London to venues all over the world.

London’s talent base, infrastructure and global accessibility plus its 400 year tradition of bank and institutional domination will continue and has led to the most cutting edge dynamism and ability to adapt.

As an infrastructure engineer, I have worked on projects in underground secure replication sites which the government operates as simultaneous infrastructure that would keep banks running if there was a war. None of these sites are in Central London, they are in remote rural areas, but the trade execution times would be identical to the in house systems should they be utilized.

This means that traders working for banks can be at home, be that Oxfordshire or Cornwall, and operate exactly as they would from the office.

Are we seeing the day that the Tier 1 dealers share an identical working environment as retail traders?

You can tell me from your apartment at 25 Canada Square!

 

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