LMAX Quietly Introduces Physical Delivery of FX on Majors
Multilateral trading facility LMAX has today added the facility of providing physical delivery of major currencies as a complimentary service

British FX and CFD exchange provider, LMAX, has today added a new service to its offering, in the form of physical delivery of major currencies.
As the only multilateral trading facility for FX, LMAX has made constant adjustments to its offering over recent months, including a shift in focus during the summer of 2013 toward greater concentration on liquidity, as well as having entered the increasingly crowded and competitive interbank market.
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Although this decision could be viewed as unusual among companies whose business model is to provide liquidity to the brokerage business, Forex Magnates discussed LMAX’s quiet introduction of the service in order to gain perspective on its importance among the company’s product offering with the firm’s COO, Scott Moffat.
Mr. Moffat explained to Forex Magnates today that, “LMAX Exchange is constantly trying to provide greater market access to our wide range of customers in over seventy countries, as demonstrated by the recent launch of CNH, RUB and XVN.
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The addition of an FX delivery service for existing customers is merely to extend this market access to our customers who occasionally have a requirement for physical FX delivery and may not normally be able to access the best rates available. Our technology, processes and range of market access mean that this is a relatively simple service for us to assist customers, but at this stage we have no intention of entering the mass market deliverable space. We feel it’s important to continually seek to provide value added services to customers.”
With LMAX having initially kept its cards very close to its chest with regard to the rationale behind adding this service, it may be worthy of note that Australian deliverable FX company OzForex issued an Initial Public Offering in September last year, listing at a somewhat stratospheric value of AUD $439 million.
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1) how does this physical delivery actually work?
2) is it similar to oanda's service where you can buy in 1 currency and then the receiver gets it in another currency in a different country?
That is a good question to pose to our compliance expert.
He answered on a related matter here:
http://experts.forexmagnates.com/what-is-your-view-on-cysec-providing-brokers-with-the-same-target-audience-as-fca-via-mifid-passporting/
I think the answer is yes on both counts.
That is a good question to pose to our compliance expert.
He answered on a related matter here:
http://experts.forexmagnates.com/what-is-your-view-on-cysec-providing-brokers-with-the-same-target-audience-as-fca-via-mifid-passporting/
I think the answer is yes on both counts.
@Andy – Indeed passporting can be refused by each individual regulator in each EU member state on an individual, case-by-case basis if the local regulator sees appropriate. MiFID passporting does not automatically grant a broker in one EU member state with a carte blanche to operate without any other checks and balances from local regulators in the host country of its clients. For example, if a CySec regulated firm takes clients from the UK, the FCA often does its own checks on that particular firm and can decide whether it wishes to deny passporting for that specific country. As yet,… Read more »
@Andy – Indeed passporting can be refused by each individual regulator in each EU member state on an individual, case-by-case basis if the local regulator sees appropriate. MiFID passporting does not automatically grant a broker in one EU member state with a carte blanche to operate without any other checks and balances from local regulators in the host country of its clients. For example, if a CySec regulated firm takes clients from the UK, the FCA often does its own checks on that particular firm and can decide whether it wishes to deny passporting for that specific country. As yet,… Read more »
Jon: Unfortunately Oanda doesn’t offer this service anymore. The price was $25 per transaction and you could exchange based on Oanda rates (like 1 pip spread in EUR/USD). That was extremely competitive. You could even send funds to third parties – i believe that is the reason why they had to stop it.
The way the lmax thing works is that you call them, they quote you a price and send the money to a bank account (that has to be in your name). But on way wider spreads than on the platform.