This page contains a Flash digital edition of a book.
particularly with the migration to internet trading, and regulatory concerns drew more attention, the White Label model came into its own.


A White Label system is an application or platform provided by a third party, generally offering technical solutions and services that can range right across the brokerage’s front, middle and back office operations. Te most common cost structure is to offer a White Label system with no up-front cost with the provider generating revenue by taking a cut of the trades that pass through the WL system – the amount or percentage being dictated by the sophistication of the solution and the volumes involved.


Ideally it offers a fast-track, cost- effective, efficient and ready-made business solution to generate new revenue opportunities, while addressing brokers’ resource constraints such as IT development budgets, staffing limitations and experience.


Choosing a solution


Deciding which WL solution may be most appropriate for a particular brokerage however is not necessarily just about issues such as the IT capabilities and functionality of the platform.


“In my view, when choosing a WL solution, liquidity is ultimately the most important factor a broker looks at. Te tighter the spreads the more profit margin there is available for the broker,” says Jonathan Brewer, head of eFX sales at Sucden Financial. “Retail clients will naturally focus on the more


Partnerships


While the wish-list of new brokers can be expansive, industry experts argue that the best White Labelling solutions involve more than just a technical product.


Muhammad Rasoul


“..over the past several years we’ve seen an uptick in White Label partnerships between established FX firms and broker/dealers, banks and other financial services firms.”


actively traded majors. Gold is also an important product. Having tight spreads and deep pools of liquidity helps to lower trading costs for the broker and improve their competitiveness.”


Te provision of access to emerging market currencies is nice to have but may not be the game-winner so often thought. “While CNH/Dollar isn’t an actively traded currency pair, it is still useful to be included in the White Label product. It is often a valuable marketing tool for clients in that region and volume may become more significant in the future,” he adds.


Like others in the sector, Artur Filipowicz, a White Label specialist and relationship manager at Dukascopy Bank. argues that those banks or brokers seeking a White Label, should look beyond the IT systems: “In some cases we’ve seen firms offering what they call a White Label solution and who just leave the client with the technology and walk away. It’s also critical to create a synergy with your partners and that’s how the relationship should be regarded – a partnership.”


“Our view is that we want to help them go to market with their new FX product range and they often need help in knowing how to position themselves in the market. For example a Swiss private bank might have different requirements than a retail Japanese FX operation. Te partnership is not just about provision of a solution,” advises Filipowicz.


“Tere’s certainly a need to work as partners, rather than as client/ service provider. For example, we often collaborate with our partners to define and customize their FX offering based on the profile of their existing customer base. Often we find that WL partners don’t really know what they should expect to be getting out of the business and our expertise is invaluable,” explains Rasoul.


INSTITUTIONAL FX SERVICES - THE BROKERS HANDBOOK 2012/2013 | 37


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80  |  Page 81  |  Page 82  |  Page 83  |  Page 84  |  Page 85  |  Page 86  |  Page 87  |  Page 88  |  Page 89  |  Page 90  |  Page 91  |  Page 92  |  Page 93  |  Page 94  |  Page 95  |  Page 96  |  Page 97  |  Page 98  |  Page 99  |  Page 100  |  Page 101  |  Page 102  |  Page 103  |  Page 104  |  Page 105  |  Page 106  |  Page 107  |  Page 108  |  Page 109  |  Page 110  |  Page 111  |  Page 112  |  Page 113  |  Page 114  |  Page 115  |  Page 116  |  Page 117  |  Page 118  |  Page 119  |  Page 120  |  Page 121  |  Page 122  |  Page 123  |  Page 124