GBE Brokers is officially launching a prime of prime offering, Finance Magnates has learned from sources with knowledge of the matter. The new unit, GBE Prime, is going to exclusively focus on providing liquidity to brokers and white label clients.
GBE Prime launches with three major server sites, located at Equinix data centres in London (LD4), New York (NY4) and Tokyo (TY3). The company has partnered up with PrimeXM using the technology provider’s XCore product suite.
Aside from XCore, PrimeXM will also provide FIX API connections to other bridge providers.
The newly appointed Head of GBE Prime, Ben Florian Henke, shared with Finance Magnates: “We have stepped into the institutional market in beginning of 2016. We are growing a lot in this business area and we are already servicing over 35 brokers with our liquidity.”
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The company’s ambitious goal is to reach 50 clients by the end of the year, with some special focus being dedicated to the Asian market. Currently the company is providing support services out of its German office in Hamburg. The company is also considering opening a sales office in Asia soon, but for the time being it is providing its services out of Cyprus and Germany.
Prime of Prime Competition Picking Up
In recent quarters a number of retail brokers have launched prime of prime products, so GBE Prime is joining a competitive space. We asked the CEO of GBE Brokers, Rifat Sayim, what the key reasons for the move are, and about his views on prime of prime competition.
“The competition is becoming more challenging not only in the prime of prime space but also in the retail brokerage area. We are confident in outperforming with our institutional department because of our excellent network of introducers and flexibility that we may offer our clients,” he said.
Henke elaborated on the liquidity relationships of GBE Prime: “We keep a few main relationships with banks and liquidity providers which we are partially aggregating. In FX we keep direct relations with 22 banks, non-bank liquidity providers and ECNs mainly through Saxo Bank. Due to our high trading volumes and the long-term relations we have achieved a very attractive pricing structure which we are also offer to our clients.”
“The banks are competing in offering us the best package of spreads, execution, technology and stability of their services (in FX and CFDs). We are selecting the best, bringing it into one package and reselling it. It would be impossible for a broker to copy our structure if trading volumes are less than 10 yards per month,” explained Sayim.
Asked about the clearing methodology that GBE Prime is using, Henke stated: “We use a hybrid model – we are able to internalize risks and have great direct relations to the banks to offer a true direct market access (DMA) environment. The majority of the flow is being sent to our external partners.”