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Higgins says that are a number of factors that will influence the choice of MT4 Liquidity Bridge provider. “Tese factors include latency, performance, reliability, liquidity provider integration, multi- asset support, partial and multiple fill support and excellent customer service around-the-clock.” Gold-i has attempted to address these customer concerns by offering a series of complimentary services such as Gold-i Gate Link, Gold-i Position Keeper and Gold-i Multi-MAM.
Scalability
Customisation features are also available in the latest generation of Bridging products but perhaps one of the most pressing issues is the need for Bridging products to provide the scalability needed to meet future volume growth. “Te speed of MT4 is the only real limitation in the number of transactions per second,” says Higgins. “Te Gold-i Gate Bridge is built for speed and reliability, and we have measured MT4 and the Bridge at around 500 transactions per second. In testing, over 5 million trades have been transacted in one day using a single Bridge.”
As with oneZero, Higgins recognises that white
labelling options and hosted service models are becoming an increasingly common feature in the MT4 Liquidity Bridging market. “Te Gold-i Gate Bridge fully supports introducing brokers and white labels,” says Higgins. “Te two can be grouped into separate liquidity groups and routed to either the same liquidity provider in different LP accounts or different liquidity providers. Gold-i does not offer its own white labels as that would compete with our own clients, however we partner with many brokers who offer white labels solutions using our products.”
Leverate is another broker solutions provider offering an MT4 Liquidity Bridging product. Leverate has developed its own risk management solution allowing brokers to either keep the risk on their own books or pass it straight through via STP to the best bid/ offer of a multi liquidity,” says director Lior Shmuely. “Te risk management platform is a smart strategy
154 | october 2011 e-FOREX
centre allowing the broker to decide how to STP the trades or alternatively keep the risk whilst checking the validity of the trade. Tere is a consistent demand to accept and pass high frequency trades via STP or checking the validity of the trades with logical rules for managing the risk and exposure, this is one of the reasons that the Leverate risk management system was indeed developed.”
ECN trade execution
Shmuely has also recognised that an increasing number of brokers are looking to reduce their market risk by offering ECN trade execution for their high volume clients. “Brokers have realised lately that pure B Book management may not be an optimum way to handle their risk, because of the growing number of accounts that have been successful as scalpers, robots and so on. It is for this purpose that the multiple liquidity risk management system that Leverate offers is such a popular solution.”
Divisa Capital is a broker specialising in e-trading and direct market access and with a focus on margin spot FX trading. According to chief executive Michael Markarian, the company chief executive,
the increasing trade volumes generated by high frequency, automated, mobile and algorithmic traders is having a profound impact on the back office and risk management operations of Retail FX brokers, many of whom demand ultra low latency and 100% availability. “Now more then ever, brokers need to be using the proper tools to not only manage market risk but to also process the multitude of messages that most automated strategies generate. IT infrastructure, from the servers to the data centres, also need to be scrutinised.”
Markarian agrees that an increasing number of brokers are looking to employ STP and ECN-based execution as a way of reducing the market risk that comes from their high frequency trading clients. “With increasing volatility and trade volumes, many larger brokers have enough scale required to STP their order flow in order to generate consistent revenues. Tis coupled with the fact that risk dramatically increases as do your fixed overhead costs when employing a dealing desk model.”
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