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services in Arena, such as the transaction blotter and market risk analytics.”
“Much of what we are trying to achieve with Arena is the ability to reach across traditional silos of asset classes and products. Tis means providing true interoperability, not just a single sign-on that grants clients access to multiple asset classes through a series of disparate platforms,” says Lauerman. “Te interoperability has to be built into the platform’s architecture and embedded throughout all the post- trade services.” Consequently Lloyds has invested in middleware, mixing commoditised components from third parties and more bespoke software developed in- house, that can link all the transaction and execution services together across asset classes. “We have a broad spectrum of clients and the secret is making the platform relevant to all of these different sectors.”
Customisation versus standardisation
As well as offering interactivity and interoperability, platform providers are also looking to provide personalisation wherever possible. Tis does create a challenge, though, in balancing the level of customisation with the standardisation needed to make the platform easy to use, says Lauerman. “It is important to offer both standardisation and client- level customisation. If you offer a single, standardised navigation, it creates a certain ease of use but you may lose the ability for clients to make the platform their own. Or you can provide total customisation by offering clients a collection of tools that they have to put together themselves – but this sacrifices ease of navigation for some client segments. As a provider it is important not to be at either end of that spectrum. It is about offering a standard, intuitive navigation combined with an ability to create your own look and feel.”
So what factors are likely to influence the future development of e-commerce platforms for FX?
Te three basic factors, says Lauerman, are client demand, technology and regulation. “Client demand is the constant in all of this. But so much of what we have been able to offer has been down to the evolution of technology. Clients have always wanted more integrated services but five years ago the technology did not exist to build a platform like Arena. It has only been the since technology like rich internet applications (RIA) was developed that we have been able to build a platform that meets their demands.”
If technology is the big enabler, regulation is typically viewed as the contrary force – a kind of macro-
24 | april 2012 e-FOREX Lucian Lauerman
“It is important to offer both standardisation and client- level customisation. If you offer a single, standardised navigation, it creates a certain ease of use but you may lose the ability for clients to make the platform their own.”
political constraint. However, for e-commerce FX platforms regulatory initiatives such as Dodd Frank, and the mandating of central clearing and swaps execution facilities can be viewed as broadly positive, says Lauerman. Te over-riding objective of all of this regulation is to bring more standardisation and transparency to the trading process, especially those asset classes such as FX where there is not typically a central counterparty involved. So regulation may influence how execution is carried out in FX and this will create a greater need for efficient pre and post-trade services. “We see changes in the regulatory environment as an opportunity to differentiate our electronic channel services from competitors.”
Transferring investment to client experience
RBS is another leading UK-based bank that has made a concerted effort in the last 12 months to gain ground in the FX e-commerce market. In September 2011 it launched its RBS Agile trading system, originally designed as a gamma hedging tool and a spot FX trading algorithm. In December 2011 RBS announced a series of enhancements to its multi-asset electronic trading platform RBSMarketplace. “We are aggregating the amount of investment we’ve made in systems and transferring it to the client experience,” says Ed Mount, head of FX technology-based trading
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