NASDAQ OMX Dips into FX - Sponsors FXIC NYC 2014

The latest proof that NASDAQ OMX is looking to tap into the foreign exchange market space comes in the wake of an announcement that the company will be sponsoring Shift Forex Forex Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Foreign exchange or forex is the act of converting one nation’s currency into another nation’s currency (that possesses a different currency); for example, the converting of British Pounds into US Dollars, and vice versa. The exchange of currencies can be done over a physical counter, such as at a Bureau de Change, or over the internet via broker platforms, where currency speculation takes place, known as forex trading.The foreign exchange market, by its very nature, is the world’s largest tradi Read this Term’s expo event FXIC NYC 2014. A press release outlines the details of the partnership between the two companies and essentially confirms the seriousness of NASDAQ OMX’ intentions to get closer to the forex market.

With the latest batch of foreign exchange manipulation investigations coming closer to concluding that serious violations are possible in the space, while moving to a centralized exchange in the foreign exchange markets remains far-fetched, we might as well be moving towards a more centralized mode of operation of the foreign exchange markets in the future - a space where NASDAQ OMX has more than enough experience to contribute to a revised market framework.

NASDAQ OMX Global Market Services

There is no doubt as to the intentions of the company to enter the foreign exchange market landscape - the latest confirmation being the launch of its Global Markets Services Business. The entity is aggregating NASDAQ OMX transactions, clearing and settlement services in the US and Europe. It is aimed at facilitating the company’s cash and derivatives business with the integration of fixed income, currencies and commodities into a single offering.

The Group's Executive Vice President and Head of the Global Market Services division of the company, Hans-Ole Jochmusen stated in a recent announcement, “The company successfully integrated trading and clearing of all our asset classes at all our Nordic and Baltic exchanges to one technology platform to allow true multi-asset trading and clearing. With the fixed income, currency and commodities markets becoming increasingly global, I'm thrilled to make NASDAQ OMX the world leader in creating a truly integrated global offering in these areas.”

With the FX space attracting major players such as NASDAQ OMX, we can certainly expect that this is not a chance event and that some meaningful new announcements are in the works. Did the company buy into the FXIC 2014 to announce a new product, or will it provide a ready solution before that?

NASDAQ’s CEO, Bob Greifeld commented in a recent press release, "As markets have become increasingly global in asset classes like fixed income, currency and commodities and in the OTC clearing space, we believe it is an opportune time to structure our transaction business in such a way that takes advantage of these opportunities."

FXIC New York 2014

The FXIC event which was started by Shift Forex last year, has attracted a number of industry participants, to discuss the current state of the FX industry, opportunities as well as Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term. With the regulatory theme US foreign exchange space sporting quite some challenges in its operations due to regulatory pressures. With the regulatory theme certainly remaining a hot topic this year, the industry is awaiting the release of proposed rules around trading and clearing of FX options and NDFs on exchanges and swap execution facilities (SEFs), as well as clearinghouses.

A new batch of innovations in the design of new trading paradigms from existing exchanges, ECNs and multi-dealer platforms as well as the possibility of new market entrants such as NASDAQ OMX will be the main focus for the FXIC NYC 2014. A key question will be to what extent the buy-side migrates to the new paradigm, which will raise their cost of financing trading activity.

Shift Forex’s founding partner and COO, Matthew Miller shared his opinion in the press release, “The company is thrilled to have NASDAQ OMX as the Presenting Sponsor this year in New York. NASDAQ OMX’s premier participation reflects the tectonic shifts that are occurring in the FX markets with the move toward a centrally-cleared model, as well as the continued blurring of the lines between various types of market participants, which is a central theme of the event.”