Perhaps one of the most encouraging dynamics within the entire forex industry so far this year has been the absolute contrast in volumes in comparison to last year. Indeed, so sharp is the contrast that technology companies providing connectivity to executing venues are experiencing a need to carry out infrastructure upgrades to accommodate the increase in trading activity.
Today, infrastructure provider TMX Atrium has completed the upgrade of its connectivity to forex ECN Knight Hotspot FX. The company began providing low-latency connectivity from the TMX Atrium hub at New York 4 since 2010 enabling Hotspot FX participants to communicate and trade with TMX Atrium’s increasing number of buy and sell side participants trading across the full range of asset classes.
A Very Prominent Big Apple
Recently, the upward direction of volumes has made its presence felt at Hotspot FX, which experienced a 14% increase during May this year as reported by Forex Magnates this week. Back in March, TMX Atrium’s Managing Director Emmanuel Carjat discussed with Forex Magnates the sustained demand for connectivity at certain hubs, and despite the Toronto-based company placing an emphasis on global point to point connectivity, Mr Carjat emphasized the importance of maintaining first class service to New York 4.
“TMX Atrium community demand is continuing between the US and Canadian markets to enable trading of US / Canadian interlisted stocks. In both cases, demand is being driven by equity/FX arbitrage opportunities between Moscow and London and between the major FX hubs especially London 4 and New York4” he stated.
More recently, just yesterday TMX Atrium connected multi-asset electronic trading and risk management specialist Raptor Trading to its community for the North American market. This product set includes order routing, algorithmic software and analytical tools that are intended to complement participants’ trading strategies. For this application, Raptor joins many multi-asset class participants that are ‘on-net’ with TMX Atrium.
Volumes Drive Expansion
TMX Atrium cites response to customer demand as the determining factor in this particular upgrade, which is certainly borne out by the figures. During May, average daily volumes at Hotspot FX reached $33.7 billion, based on 23 trading days. Of course, the resources required to conduct a connectivity upgrade are substantial and therefore the greater picture must be taken into account in order to assess viability.
With Hotspot FX having recorded record volumes of $774.7 billion in May this year, compared with $649.6 billion in 2012, it certainly demonstrates the requirement for further investment in infrastructure.
Emmanuel Carjat, Managing Director of TMX Atrium made a corporate statement regarding the expansion of the relationship between the two companies: “We are delighted to further our relationship with Knight Hotspot FX. Our network has been designed to scale with the growing demands of FX trading. This capability complements the steady increase in demand for access to FX trading locations such as Hotspot. Extending partnerships with firms such as Hotspot ensures that we continue to offer our clients a wide range of choice of trading venues.”
John Miesner, Managing Director and Head of Global Sales, Knight Hotspot FX, added, “As demand for our FX capabilities increases we are confident that TMX Atrium provides the necessary bandwidth both now and in the future as FX volumes grow rapidly. TMX Atrium’s infrastructure upgrades enable clients utilizing their services to access Knight Hotspot FX from North America, Europe and Russia and take advantage of our full range of products and services.”