What Are the Benefits of a Technology Driven Liquidity Provider?
Tuesday,15/06/2021|10:34GMTby
INFINOX
Discover the tools of the trade to ensure you remain compliant with governance.
FM
As retail traders of the financial markets, it’s important that individuals have clarity and assurances over the safety and security of their investment activities.
The European Securities and Markets Authority (ESMA) introduced the Markets in Financial Instruments Directive (MiFID) in 2007, providing direct regulation over Liquidity providers and harmonised services that retail clients can expect across the board.
Although the original MiFID outlines the regulatory reporting requirements of liquidity providers and the required conduct of investment service providers, MiFID II and MiFIR went further still in 2018 to facilitate even further transparency for retail traders.
These new measures were designed to protect those using leveraged products, including contracts for difference (CFDs) – a product that is most used by retail traders.
Why do retail clients need liquidity providers?
Liquidity providers are also referred to as market makers. The primary role of liquidity providers is to deliver consistent two-way pricing across assets throughout the training week.
They make their money via the Bid/Ask spread and as such, are incentivised to win your order flow by offering tight spreads in a healthy size. Liquidity providers create the market for buyers and sellers to execute their orders.
Retail clients execute orders via Brokers, and often look for who is providing the most attractive terms by way of spreads and top of book depth.
Clients thrive on consistent pricing, which means reduced slippage and high fill rates.
What safeguards should you expect?
The impact of MiFID II has forced the financial service sector to revisit the storage and usage of client assets.
The new regulation helps to safeguard retail clients’ liquidity by enforcing investment firms and brokerages to implement proper controls that segment your funds from their own operating funds. MiFID II also encourages brokers to implement negative balance protection on a “per account” basis.
These measures, along with the most reputable regulators, such as the UK’s Financial Conduct Authority (FCA), are helping to protect the best interests of retail traders.
Regulation
To promote stable, orderly financial markets and a secure trading environment for retail clients, brokers, exchanges and liquidity providers should be well-regulated.
The gold standard for UK-based retail traders remains the FCA, while the Securities Commission of The Bahamas (SCB) is another regulator that licenses many of the leading brokerages and exchanges throughout Europe.
Negative balance protection
The FCA implemented new permanent restrictions on CFD trading for retail clients as of July 2019, ensuring that clients cannot lose more than the total funds deposited within their CFD brokerage account. This restriction is known as negative balance protection.
Segregated accounts and tier one banks
Brokers and trading exchanges licensed by the likes of FCA must ensure adequate segregation of client money accounts. Client funds should always be kept separate from the operator’s own funds.
This ring-fences the funds of retail clients, ensuring their money is protected should the operator cease its operations.
Safe deposit methods
The safety of retail client funds is paramount to the reputation and business activity of the leading brokerages and trading exchanges. Retail traders should look for brokers and exchanges that encrypt user connections using Secure Socket Layer (SSL) technology.
This ensures all sensitive financial data is transferred in a secure, cryptographically protected environment, away from the prying eyes of potential cyber-criminals.
The importance of negative balance protection for retail clients
Negative balance protection is a feature offered by brokerages and exchanges to retail clients to ensure losses don’t exceed deposits. As the guiding regulator, the FCA is the party that describes what is a retail client exactly.
To be precise, retail clients are individuals that are “not a professional client”, such as those who trade as a hobby or in search of a second income.
Under MiFID II, retail investors have more protection and compensation rights than professional clients.
Negative balance protection is a major commitment from brokers and exchanges, who are typically qualified as “professional clients” in the eyes of their liquidity providers.
This means they are often forced to take the risk of their retail clients on the chin, reinforcing the need for brokers to carefully select the right liquidity providers that abide by the ESMA’s ‘best execution policy’, enabling brokers to close negative positions fast and minimise losses incurred.
There are state-of-the-art trading platforms that give retail clients total oversight of their market exposure for sharper, more engaging Risk Management.
UK-based INFINOX’s IX Prime platform provides a tool called ‘Position Keeper’ that allows institutional entities to get a transparent overview of their exposure per asset class, with risk metrics putting clients firmly in the picture as to how their books are positioned.
Having the framework in place is vital for compliance and growth
The concept of MiFID II has long been to improve the openness and competitiveness of the financial markets for retail traders.
For global financial trading brokerages to continue to compete and grow, having the technological foundations in place is equally as important as securing multiple licenses to provide regulated retail trading in all four corners of the globe.
This includes building a digital network of liquidity sources that can provide lightning-fast execution and accurate market prices.
IX Prime simplifies how trading platforms monitor their exposure with systems like Position Keeper.
This is as well as having systems to simulate news releases that may impact your client’s positions, and subsequently, your underlying profit and loss systems.
The IX PRIME platform hosts access to multiple liquidity sources, including Prime of Prime partners, Tier 1 banks and market makers.
IX Prime pairs its clients – which include retail brokers, exchanges and hedge funds – with liquidity providers through matching order and flow type executions to ensure the tightest prices and most efficient venue.
Liquidity providers like IX PRIME that can provide institutional-level liquidity and compatibility with state-of-the-art trading platforms like MetaTrader 4 and 5 are best-placed for long-term growth.
It’s incumbent upon brokers and exchanges to use liquidity providers in accordance with ESMA guidelines.
These guidelines insist that brokers and exchanges should never be “over-reliant” on a single liquidity provider or venue, which is why multi-source providers like IX PRIME are well-positioned to meet the volume requirements of partners and their retail clients in the years ahead.
MiFID II also insists that brokers and exchanges consider the “expertise and market reputation” of third-party liquidity providers and ensure they do everything in their power to use market makers that deliver “the best possible result” to retail clients.
MiFID II now considers a key driver of a market maker’s reputation as being their ability to excel in the “execution of client orders” too.
Brokers can safeguard retail clients’ liquidity by working with reputable and compliant LP partners that can cover MiFID II requirements and deliver fair, transparent execution for retail traders.
About IX Prime
IX Prime is a specialist liquidity provider, serving professional clients with institutional-level liquidity. INFINOX is a globally recognised brokerage, with active partners and clients around the world. Since 2009 we have grown from strength to strength. We have always been focused on servicing our clients and our partners.
As retail traders of the financial markets, it’s important that individuals have clarity and assurances over the safety and security of their investment activities.
The European Securities and Markets Authority (ESMA) introduced the Markets in Financial Instruments Directive (MiFID) in 2007, providing direct regulation over Liquidity providers and harmonised services that retail clients can expect across the board.
Although the original MiFID outlines the regulatory reporting requirements of liquidity providers and the required conduct of investment service providers, MiFID II and MiFIR went further still in 2018 to facilitate even further transparency for retail traders.
These new measures were designed to protect those using leveraged products, including contracts for difference (CFDs) – a product that is most used by retail traders.
Why do retail clients need liquidity providers?
Liquidity providers are also referred to as market makers. The primary role of liquidity providers is to deliver consistent two-way pricing across assets throughout the training week.
They make their money via the Bid/Ask spread and as such, are incentivised to win your order flow by offering tight spreads in a healthy size. Liquidity providers create the market for buyers and sellers to execute their orders.
Retail clients execute orders via Brokers, and often look for who is providing the most attractive terms by way of spreads and top of book depth.
Clients thrive on consistent pricing, which means reduced slippage and high fill rates.
What safeguards should you expect?
The impact of MiFID II has forced the financial service sector to revisit the storage and usage of client assets.
The new regulation helps to safeguard retail clients’ liquidity by enforcing investment firms and brokerages to implement proper controls that segment your funds from their own operating funds. MiFID II also encourages brokers to implement negative balance protection on a “per account” basis.
These measures, along with the most reputable regulators, such as the UK’s Financial Conduct Authority (FCA), are helping to protect the best interests of retail traders.
Regulation
To promote stable, orderly financial markets and a secure trading environment for retail clients, brokers, exchanges and liquidity providers should be well-regulated.
The gold standard for UK-based retail traders remains the FCA, while the Securities Commission of The Bahamas (SCB) is another regulator that licenses many of the leading brokerages and exchanges throughout Europe.
Negative balance protection
The FCA implemented new permanent restrictions on CFD trading for retail clients as of July 2019, ensuring that clients cannot lose more than the total funds deposited within their CFD brokerage account. This restriction is known as negative balance protection.
Segregated accounts and tier one banks
Brokers and trading exchanges licensed by the likes of FCA must ensure adequate segregation of client money accounts. Client funds should always be kept separate from the operator’s own funds.
This ring-fences the funds of retail clients, ensuring their money is protected should the operator cease its operations.
Safe deposit methods
The safety of retail client funds is paramount to the reputation and business activity of the leading brokerages and trading exchanges. Retail traders should look for brokers and exchanges that encrypt user connections using Secure Socket Layer (SSL) technology.
This ensures all sensitive financial data is transferred in a secure, cryptographically protected environment, away from the prying eyes of potential cyber-criminals.
The importance of negative balance protection for retail clients
Negative balance protection is a feature offered by brokerages and exchanges to retail clients to ensure losses don’t exceed deposits. As the guiding regulator, the FCA is the party that describes what is a retail client exactly.
To be precise, retail clients are individuals that are “not a professional client”, such as those who trade as a hobby or in search of a second income.
Under MiFID II, retail investors have more protection and compensation rights than professional clients.
Negative balance protection is a major commitment from brokers and exchanges, who are typically qualified as “professional clients” in the eyes of their liquidity providers.
This means they are often forced to take the risk of their retail clients on the chin, reinforcing the need for brokers to carefully select the right liquidity providers that abide by the ESMA’s ‘best execution policy’, enabling brokers to close negative positions fast and minimise losses incurred.
There are state-of-the-art trading platforms that give retail clients total oversight of their market exposure for sharper, more engaging Risk Management.
UK-based INFINOX’s IX Prime platform provides a tool called ‘Position Keeper’ that allows institutional entities to get a transparent overview of their exposure per asset class, with risk metrics putting clients firmly in the picture as to how their books are positioned.
Having the framework in place is vital for compliance and growth
The concept of MiFID II has long been to improve the openness and competitiveness of the financial markets for retail traders.
For global financial trading brokerages to continue to compete and grow, having the technological foundations in place is equally as important as securing multiple licenses to provide regulated retail trading in all four corners of the globe.
This includes building a digital network of liquidity sources that can provide lightning-fast execution and accurate market prices.
IX Prime simplifies how trading platforms monitor their exposure with systems like Position Keeper.
This is as well as having systems to simulate news releases that may impact your client’s positions, and subsequently, your underlying profit and loss systems.
The IX PRIME platform hosts access to multiple liquidity sources, including Prime of Prime partners, Tier 1 banks and market makers.
IX Prime pairs its clients – which include retail brokers, exchanges and hedge funds – with liquidity providers through matching order and flow type executions to ensure the tightest prices and most efficient venue.
Liquidity providers like IX PRIME that can provide institutional-level liquidity and compatibility with state-of-the-art trading platforms like MetaTrader 4 and 5 are best-placed for long-term growth.
It’s incumbent upon brokers and exchanges to use liquidity providers in accordance with ESMA guidelines.
These guidelines insist that brokers and exchanges should never be “over-reliant” on a single liquidity provider or venue, which is why multi-source providers like IX PRIME are well-positioned to meet the volume requirements of partners and their retail clients in the years ahead.
MiFID II also insists that brokers and exchanges consider the “expertise and market reputation” of third-party liquidity providers and ensure they do everything in their power to use market makers that deliver “the best possible result” to retail clients.
MiFID II now considers a key driver of a market maker’s reputation as being their ability to excel in the “execution of client orders” too.
Brokers can safeguard retail clients’ liquidity by working with reputable and compliant LP partners that can cover MiFID II requirements and deliver fair, transparent execution for retail traders.
About IX Prime
IX Prime is a specialist liquidity provider, serving professional clients with institutional-level liquidity. INFINOX is a globally recognised brokerage, with active partners and clients around the world. Since 2009 we have grown from strength to strength. We have always been focused on servicing our clients and our partners.
IronFX Celebrates 15 Years of Creating Strong Partnerships
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Join seasoned marketing executives and specialists as they discuss the main challenges they identify in financial services in 2026 and how they address them.
Attendees of this session will walk away with:
- A nuts-and-bolts account of acquisition costs across platforms and geos
- Analysis of today’s multi-layered audience segments and differences in behaviour
- First-hand account of how global brokers balance consistency and local flavour
- Notes from the field about intelligently using AI and automation in marketing
Speakers:
-Yam Yehoshua, Editor-In-Chief at Finance Magnates
-Federico Paderni, Managing Director for Growth Markets in Europe at X
-Jo Benton, Chief Marketing Officer, Consulting | Fractional CMO
-Itai Levitan, Head of Strategy at investingLive
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-Tony Cross, Director at Monk Communications
#fmls #fmls25 #fmevents #FintechMarketing #AI #DigitalStrategy #Fintech #Innovation
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
As brokers eye B2B business and compete with fintechs and crypto exchanges alike, marketers need to act wisely with often limited budgets. AI can offer scalable solutions, but only if used properly.
Join seasoned marketing executives and specialists as they discuss the main challenges they identify in financial services in 2026 and how they address them.
Attendees of this session will walk away with:
- A nuts-and-bolts account of acquisition costs across platforms and geos
- Analysis of today’s multi-layered audience segments and differences in behaviour
- First-hand account of how global brokers balance consistency and local flavour
- Notes from the field about intelligently using AI and automation in marketing
Speakers:
-Yam Yehoshua, Editor-In-Chief at Finance Magnates
-Federico Paderni, Managing Director for Growth Markets in Europe at X
-Jo Benton, Chief Marketing Officer, Consulting | Fractional CMO
-Itai Levitan, Head of Strategy at investingLive
-Roberto Napolitano, CMO at Innovate Finance
-Tony Cross, Director at Monk Communications
#fmls #fmls25 #fmevents #FintechMarketing #AI #DigitalStrategy #Fintech #Innovation
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
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This candid panel brings together builders across the trading infrastructure space to uncover the shifting dynamics behind tools, interfaces, and full-stack ambitions.
Attendees will hear:
-Why platform dependency has become one of the most overlooked risks in the trading business?
-Buy vs. build: What do hybrid models look like, and why are industry graveyards filled with failed ‘killer apps’?
-How AI is already changing execution, risk, and reporting—and what’s next?
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Speakers:
-Stephen Miles, Chief Revenue Officer at FYNXT
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-Matthew Smith, Group Chair & CEO at EC Markets
-Tom Higgins, Founder & CEO at Gold-i
-Gil Ben Hur, Founder at 5% Group
#fmls #fmls25 #fmevents #Brokers #Trading #Fintech #FintechInnovation #TradingTechnology #Innovation
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
Much like their traders in the market, brokers must diversify to manage risk and stay resilient. But that can get costly, clunky, and lengthy.
This candid panel brings together builders across the trading infrastructure space to uncover the shifting dynamics behind tools, interfaces, and full-stack ambitions.
Attendees will hear:
-Why platform dependency has become one of the most overlooked risks in the trading business?
-Buy vs. build: What do hybrid models look like, and why are industry graveyards filled with failed ‘killer apps’?
-How AI is already changing execution, risk, and reporting—and what’s next?
-Which features, assets, and tools gain the most traction, and where brokers should look for tech-driven retention?
Speakers:
-Stephen Miles, Chief Revenue Officer at FYNXT
-John Morris, Co-Founder at FXBlue
-Matthew Smith, Group Chair & CEO at EC Markets
-Tom Higgins, Founder & CEO at Gold-i
-Gil Ben Hur, Founder at 5% Group
#fmls #fmls25 #fmevents #Brokers #Trading #Fintech #FintechInnovation #TradingTechnology #Innovation
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
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- Building trader communities through education and local expertise
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-Adam Button, Chief Currency Analyst at investingLive
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#fmls #fmls25 #fmevents #Brokers #FinanceLeadership #Trading #Fintech #BrokerGrowth #FintechPartnerships #RegionalMarkets
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
When acquisition costs rise and AI generated reviews are exactly as useful as they sound, performing and fair partners can make or break brokers.
This session looks at how these players are shaping access, trust and user engagement, and what the most effective partnership models look like in 2025.
Key Themes:
- Building trader communities through education and local expertise
- Aligning broker incentives with long-term regional strategies
- Regional regulation and the realities of compliant acquisition
- What’s next for performance-driven partnerships in online trading
Speakers:
-Adam Button, Chief Currency Analyst at investingLive
-Zander Van Der Merwe, Key Individual & Head of Sales at TD Markets
-Brunno Huertas, Regional Manager – Latin America at Tickmill
-Paul Chalmers, CEO at UK Trading Academy
#fmls #fmls25 #fmevents #Brokers #FinanceLeadership #Trading #Fintech #BrokerGrowth #FintechPartnerships #RegionalMarkets
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
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-Simon Pelletier, Head of Product at Yuh
Gerald Perez, CEO at Interactive Brokers UK
#fmls #fmls25 #fmevents #Brokers #FinanceLeadership #Trading #Fintech #Innovation
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
As the arms race to bundle investing, personal finance, and wallets under super apps grows fiercer, brokers are caught between a rock and a hard place.
This session explores unexpected ways for industry players to collaborate as consumer habits evolve, competitors eye the traffic, and regulation becomes more nuanced.
Speakers:
-Laura McCracken,CEO | Advisory Board Member at Blackheath Advisors | The Payments Association
-Slobodan Manojlović,Vice President | Lead Software Engineer at JP Morgan Chase & Co.
-Jordan Sinclair, President at Robinhood UK
-Simon Pelletier, Head of Product at Yuh
Gerald Perez, CEO at Interactive Brokers UK
#fmls #fmls25 #fmevents #Brokers #FinanceLeadership #Trading #Fintech #Innovation
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
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#fmls #fmls25 #fmevents #Brokers #FinanceLeadership #Trading #Fintech #RetailInvesting #UKFinance
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
As the dire state of listing and investment in the UK goes from a financial services problem to a national challenge, the retail investing industry is taken to task.
Join a host of executives and experts for a candid conversation about the future of millions of Brits, as seen from a financial services standpoint:
-Are they happy with the Leeds Reform, in principle and in practice?
-Is it the government’s job to affect the ‘saver’ mentality? Is it doing well?
-What can brokers and fintechs do to spur UK investment?
-How can the FCA balance greater flexibility with consumer protection?
Speakers:
-Adam Button, Chief Currency Analyst at investingLive
-Nicola Higgs, Partner at Latham & Watkins
-Dan Lane, Investment Content Lead at Robinhood UK
-Jack Crone, PR & Public Affairs Lead at IG
-David Belle, Founder at Fink Money
#fmls #fmls25 #fmevents #Brokers #FinanceLeadership #Trading #Fintech #RetailInvesting #UKFinance
Connect with us at:
🔗 LinkedIn: / financemagnates-events
👍 Facebook: / financemagnatesevents
📸 Instagram: / fmevents_official
🐦 Twitter: / f_m_events
🎥 TikTok: / fmevents_official
