The Evolution Of Post-Trade Technology: Alpha Omega Launches FIXAffirm Solution

The developmental curve of systems relating to post-trade processing has taken an upward turn over the last twelve months, partly due to the regulatory restructuring in the United States which has completely changed the method by which electronic trades are processed under the Dodd-Frank Act, and partly due to an increasing need among broker/dealers for the trade cycle to be as efficient as possible.

Today, Alpha Omega Financial Systems has announced the launch of a new product which aims at the institutional post-trade segment, and has been based on the principles of the industry standard FIX Protocol.

Automated Allocation

Under the designation of FIXAffirm, Alpha Omega's new solution has been made available in two versions, enterprise as well as hosted.

According to Alpha Omega, FIXAffirm directly connects asset managers and counterparty broker/dealers to deliver fully automated allocation, confirmation and affirmation of trades immediately after trade Execution Execution Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Execution is the process during which a client submits an order to the brokerage, which consequently executes it resulting in an open position in a given asset. The execution of the order occurs only when it is filled. There is typically a time delay between the placement of the order and the execution which is called latency.In the retail FX space, reliable brokers always strive to deliver best execution to their clients in order to maintain a solid business relationship with them. This is a co Read this Term.

FIXAffirm makes the post-trade process much more efficient and cost-effective for asset managers, hedge funds and broker/dealers.

Standardization In Institutional Post-Trade Processing

At the beginning of this year, FIX Protocol made its foray into implementing a standardization of post-trade industry guidelines to encourage the adoption of FIX Protocol for post-trade processing between buy-sides and sell-sides that can be used bilaterally, as well as through intermediary facilities.

As a result, a number of members of the then named Fix Protocol community began developing post-trade services and leveraging the best practices that have been developed.

At that time, Courtney McGuinn, Fix Protocol's Operations Director explained to Forex Magnates that the reason for embarking on the roll out of a full set of guidelines for post-trade processing were threefold: Firstly, increased availability had become an industry requirement, with direct communication required between Buy-Side Buy-Side The buy-side is comprised of firms in the financial industry that purchase securities and are accompanied by account investment managers, pension funds, and hedge funds.The buy-side is composed of those that buy and invest large sums of securities with the intention of generating a lucrative return or have their funds managed. The Buy-Side ExplainedIn terms of Wall Street, the buy-side includes investment institutions that purchase securities, stocks, or other financial instruments with the aim The buy-side is comprised of firms in the financial industry that purchase securities and are accompanied by account investment managers, pension funds, and hedge funds.The buy-side is composed of those that buy and invest large sums of securities with the intention of generating a lucrative return or have their funds managed. The Buy-Side ExplainedIn terms of Wall Street, the buy-side includes investment institutions that purchase securities, stocks, or other financial instruments with the aim Read this Term and sell-side.

Secondly, there had been an upturn in the demand for automation and processing speed to be enhanced, as a result of STP technology and a requirement to substantially reduce out-of-band communication delay and cost, and lastly a demand for increased acccuracy, traceability, and footing within the post-trade cycle of messaging had become apparent.

Cost and reduction of manual intervention had been taken into consideration, and by May this year, an entire set of guidelines had been published by FIX Protocol which defined a comprehensive worldwide industry standard by which post-trade processing should take place, with an emphasis on the facilitation of phased implementation by both the buy-side and sell-side communities.

Lastly, FIX Protocol underwent a rebranding exercise, the first in its 21 years of existence, and as of August this year became the FIX Trading Community, reflecting its expansion of resources amid the institutional electronic trading industry.

Alignment With FIX Principles

Speaking with regard to Alpha Omega's release of FIXAffirm and detailing the basis upon which it echoes FIX Protocol's industry standard guidelines, Ignatius John, President of Alpha Omega publicly stated that: "Leading asset managers and broker/dealers are spearheading the adoption of the FIX protocol for post-trade in order to benefit from lower costs and better integration with trading systems."

"FIXAffirm facilitates this adoption by offering an off-the-shelf solution that integrates seamlessly with either in-house or third party order management systems," concluded Mr. John.

Early adopters of FIXAffirm include a top global asset manager and leading broker/dealers, the names of which the company has at this stage not announced.

Additionally, Linedata, the global solutions provider to investment managers, has formed a partnership with Alpha Omega to enable clients of its Linedata Longview system to achieve Straight-Through Processing (STP) between their front, middle and back offices.

Adding to Mr. John's commercial statement, Kamal Duggirala, CEO of Alpha Omega commented, "We are very pleased with the performance of FIXAffirm in delivering near real-time post-trade processing.

"Our clients are achieving a significant reduction in post-trade costs, which ultimately adds to portfolio returns," concluded Mr. Duggirala.