ICAP’s company Traiana, dedicated to pre-trade and post-trade services, has issued a company statement outlining that it is expanding its kill switch functionality on its CreditLink service to FX single dealer platforms. The first platform to integrate the feature is Citi’s Velocity.
The service was first introduced back in 2011, including the leading prime brokerages and connecting them with leading ECN platforms. The kill switch feature has been designed to help mitigate risks associated with high-frequency and algorithmic trading which demand much more rigorous controls for real-time risk. The feature is integrated with ECN credit and uses post-trade APIs to notify brokers about exposure limits and allows brokers to terminate trading activity with a single switch.
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The single dealer platform service is to be launched just a couple of weeks after the announcement made by the company, highlighting the addition of its post-trade processing of trades executed on Swap Execution Facilities (SEFs). Up until now the kill switch feature has only been available to leading prime FX brokerages, connected to most ECN platforms. With the growth of single dealer platforms the capability has now been expanded, bringing Velocity into the fray. Citi’s platform is the only single dealer platform which currently sports the kill switch functionality.
Commenting on the announcement, Citi’s Global Head of FX Institutional e-Commerce Sales, Bapi Maitra,outlined, “The implementation of Traiana’s real-time risk management capability, including its kill switch, is a vital step in the direction of reducing systemic risk and promoting transparency. We are excited to partner with Traiana to take a leading role on these initiatives, and to provide best-in-class risk control solutions for our clients.”