In a similar move to EBS, which was made all the way back in the summer of 2012, Thomson Reuters has publicly announced that it is publishing its revised Rule Book for users of the anonymous Thomson Reuters Matching platform. The new guidelines are aiming to solidify liquidity and introduce higher certainty of execution for all clients of the platform. The updated rules will be issued after a year-long consultation with market participants on the subject.
The changes will affect fill ratios, minimum quote life and tick sizes, and increased surveillance measures to police activity on the venue. It has also announced a pilot project to test randomized order processing in a selected currency pair from early 2015.
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The move comes as FX trading volumes at Thomson Reuters and EBS have been dwindling. However, the former is better positioned as the company also owns Fxall, where the numbers have continued to show resilience, despite an overall industry downtrend.
According to a company statement issued on the matter, The Rule Book sets out a combination of platform controls and behavioural rules to encourage activity to sustain primary markets. Thomson Reuters’ Global Head of FX, Phil Weisberg, stated in the company’s announcement, “The rule book changes are designed to safeguard trading practices and behaviours that sustain primary markets, Thomson Reuters has consulted widely on this redrafted Rule Book and it reflects our commitment to responsible stewardship of the FX markets.”
With the FX fixing manipulation investigation slowly catching up, the Rule Book also aims to minimize the use of trading techniques that can lead to violations of Market Conduct Rules. Mr. Weisberg elaborated, “We have a responsibility to our clients to promote trading behaviours and practices on our Matching platform that comply with Market Conduct Rules. The rules are based on rigorous observation and analysis of trading behavior on the platform and were discussed with clients during a consultation process that we initiated more than one year ago.”