Finance Magnates spoke with Fair Trading Technology’s (FTT) Chief Executive Officer, Finn Jakobsen, for his perspective on the company, as well as its recent developments and initiatives. His in-depth interview can be read in full below.
1. Have there been any developments internally at FTT recently?
If we take a bit of background for the past twelve months, the last of our four founders at FTT have retired from the company. Since then however, we have had no founders involved in the day-to-day operations, signaling a new era for the firm. That being said, our four founders are still shareholders, though they are now separated from day-to-day operations of the company..
2. As part of this shift, can you tell me what initiatives or changes transpired at FTT?
One of our first initiatives was to do a reorganization of our operations by consolidating our staff, thereby focusing on a group of specialized individuals that allowed us to focus on what was important to us, i.e. the further development of our software, sales and onboarding.
On the development side we have been stabilizing and optimizing core parts of our technology, the T3 Hub. In addition, we have been spending a lot of time developing Broker Tools, the supporting software that is connected to the T3 Hub. This is a CRM tool and contains amongst other features affiliate management and risk management systems, client and sub-broker configuration. The latest addition is a White Label Creator, allowing our broker clients to create sub-white labels without our assistance. We have also developed a cohesive trader's room, that allows users to follow his or her trading, whilst reporting their respective trade history. This service is accessible also from mobile devises like tablets and smartphones.
Ultimately, what we wanted was to move away from being ‘just another bridge provider’, rather we wanted to add more functionality to make life easier for the broker and end users. A final track we wanted to pursue was one that we communicated back in January – this involved the establishment of partnership with First Derivatives and its Delta Flow Risk Management platform in conjunction with our T3 Hub and Broker Tools. Presently, we are in the final phase of onboarding the first client on this structure.
3. Can you tell me what the rational was behind the integration with the Delta Flow platform?
Delta Flow is a highly advanced trading platform with risk management, Liquidity
Liquidity
The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent
The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent
Read this Term aggregation and advanced credit and flow management features allowing brokers to create liquidity pools, benefit from Smart Order Routing and Trade Netting. By connecting the Delta Flow platform to our existing MT4 software suite, we have created a full line of product from the liquidity providers that are already connected to Delta Flow, to the end users – truly, this is a door-to-door solution. If you sum this up in a way it's about finding and defining the niche we want to be in, and not trying to be everything to everyone.. Instead we want to make strategic partnerships to add functionality that is not within our core focus.
4. I understand you have been active with restructuring your data capabilities? Can you elaborate?
Another thing we have been doing over this time is making our infrastructure as fast as possible, which includes setting up data centers in such hubs as London and Tokyo – both are live right now. We are no longer hosting in our old data center in Zurich, having completed the process during Q1 2015. There is always a lot of fine-tuning and moving services in phases and it is a process that takes a while. We did configuration during January and February and the transfer of services during March. This represents a herculean effort and takes some planning as we wanted to be as thorough as possible to avoid disruptions for our clients.
5. Did you opt for LD4 or TY3 or if not, what was behind this decision-making?
We are currently hosting out of both London and Tokyo, however not inside the walls of LD4 and TY3 and that's a pure cost benefit evaluation. We think we have no significant latency disadvantage from being outside, compared to the price of being on the inside. To some extent, I think, some companies opt for LD4 or TY3 as they retain the ability to say they are there as a marketing or sales pitch as well.
6. How does the world look after the Swiss National Bank (SNB) decision earlier this year?
I think what we see now is that credit is the new black in the market and the event in Switzerland proves that it is not easy to run a Prime of Prime (PoP) business. Unfortunately, the events in January also have yielded a sizable number of victims in this realm. Our business model being focused strictly on technology and catering to the broker side of technology proves to be correct for us, given the history of PoP.
If you had a trading infrastructure with someone who is also providing you with liquidity, you are in essence putting all your eggs in one basket and if something goes wrong with your PoP liquidity provider you are stuck with full package and burden and that's difficult to get out of quickly. If you are unhappy with execution, you cannot easily switch technologies and vice versa. It’s critically important and makes a lot of sense to get these from different providers entities.
The CHF event earlier this year truly was a Black Swan
Black Swan
A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in
A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in
Read this Term event, and most people did not think it could truly be that bad. This just emphasizes your need to prepare for the unforeseen. Our systems at FTT worked well through these days in January as our technology was able to deal with the pressure, and any issues in the aftermath that we had to solve together with our clients was caused by events out of our control.
We did have a good test of our systems on January 15. Ultimately, the event has absolutely been a wake up call, and those that are taking a credit risk are being more thorough. I hope that it will add some cautiousness as well, especially with regards in how brokers leverage their business. We should learn from this or history is bound to repeat itself. As Einstein once said, insanity is doing the same thing over and over again and expecting different results.
Finance Magnates spoke with Fair Trading Technology’s (FTT) Chief Executive Officer, Finn Jakobsen, for his perspective on the company, as well as its recent developments and initiatives. His in-depth interview can be read in full below.
1. Have there been any developments internally at FTT recently?
If we take a bit of background for the past twelve months, the last of our four founders at FTT have retired from the company. Since then however, we have had no founders involved in the day-to-day operations, signaling a new era for the firm. That being said, our four founders are still shareholders, though they are now separated from day-to-day operations of the company..
2. As part of this shift, can you tell me what initiatives or changes transpired at FTT?
One of our first initiatives was to do a reorganization of our operations by consolidating our staff, thereby focusing on a group of specialized individuals that allowed us to focus on what was important to us, i.e. the further development of our software, sales and onboarding.
On the development side we have been stabilizing and optimizing core parts of our technology, the T3 Hub. In addition, we have been spending a lot of time developing Broker Tools, the supporting software that is connected to the T3 Hub. This is a CRM tool and contains amongst other features affiliate management and risk management systems, client and sub-broker configuration. The latest addition is a White Label Creator, allowing our broker clients to create sub-white labels without our assistance. We have also developed a cohesive trader's room, that allows users to follow his or her trading, whilst reporting their respective trade history. This service is accessible also from mobile devises like tablets and smartphones.
Ultimately, what we wanted was to move away from being ‘just another bridge provider’, rather we wanted to add more functionality to make life easier for the broker and end users. A final track we wanted to pursue was one that we communicated back in January – this involved the establishment of partnership with First Derivatives and its Delta Flow Risk Management platform in conjunction with our T3 Hub and Broker Tools. Presently, we are in the final phase of onboarding the first client on this structure.
3. Can you tell me what the rational was behind the integration with the Delta Flow platform?
Delta Flow is a highly advanced trading platform with risk management, Liquidity
Liquidity
The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent
The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent
Read this Term aggregation and advanced credit and flow management features allowing brokers to create liquidity pools, benefit from Smart Order Routing and Trade Netting. By connecting the Delta Flow platform to our existing MT4 software suite, we have created a full line of product from the liquidity providers that are already connected to Delta Flow, to the end users – truly, this is a door-to-door solution. If you sum this up in a way it's about finding and defining the niche we want to be in, and not trying to be everything to everyone.. Instead we want to make strategic partnerships to add functionality that is not within our core focus.
4. I understand you have been active with restructuring your data capabilities? Can you elaborate?
Another thing we have been doing over this time is making our infrastructure as fast as possible, which includes setting up data centers in such hubs as London and Tokyo – both are live right now. We are no longer hosting in our old data center in Zurich, having completed the process during Q1 2015. There is always a lot of fine-tuning and moving services in phases and it is a process that takes a while. We did configuration during January and February and the transfer of services during March. This represents a herculean effort and takes some planning as we wanted to be as thorough as possible to avoid disruptions for our clients.
5. Did you opt for LD4 or TY3 or if not, what was behind this decision-making?
We are currently hosting out of both London and Tokyo, however not inside the walls of LD4 and TY3 and that's a pure cost benefit evaluation. We think we have no significant latency disadvantage from being outside, compared to the price of being on the inside. To some extent, I think, some companies opt for LD4 or TY3 as they retain the ability to say they are there as a marketing or sales pitch as well.
6. How does the world look after the Swiss National Bank (SNB) decision earlier this year?
I think what we see now is that credit is the new black in the market and the event in Switzerland proves that it is not easy to run a Prime of Prime (PoP) business. Unfortunately, the events in January also have yielded a sizable number of victims in this realm. Our business model being focused strictly on technology and catering to the broker side of technology proves to be correct for us, given the history of PoP.
If you had a trading infrastructure with someone who is also providing you with liquidity, you are in essence putting all your eggs in one basket and if something goes wrong with your PoP liquidity provider you are stuck with full package and burden and that's difficult to get out of quickly. If you are unhappy with execution, you cannot easily switch technologies and vice versa. It’s critically important and makes a lot of sense to get these from different providers entities.
The CHF event earlier this year truly was a Black Swan
Black Swan
A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in
A Black Swan event is most commonly associated with an unforeseen calamity or event. In its most basic form, this event results in disastrous consequences for multiple parties, markets, or individuals and are characterized as extraordinarily rare in frequency, yet are seemingly predictable in retrospect. In the foreign exchange space, the most noteworthy of these events in recent memory was the Swiss National Bank (SNB) crisis which roiled currency markets back on January 15, 2015.During this in
Read this Term event, and most people did not think it could truly be that bad. This just emphasizes your need to prepare for the unforeseen. Our systems at FTT worked well through these days in January as our technology was able to deal with the pressure, and any issues in the aftermath that we had to solve together with our clients was caused by events out of our control.
We did have a good test of our systems on January 15. Ultimately, the event has absolutely been a wake up call, and those that are taking a credit risk are being more thorough. I hope that it will add some cautiousness as well, especially with regards in how brokers leverage their business. We should learn from this or history is bound to repeat itself. As Einstein once said, insanity is doing the same thing over and over again and expecting different results.
