First Derivatives’ Kx Tech Powers R5’s Connection Between China and London

It’s been a couple of months since the announcement by UK Prime Minister Theresa May that London’s and China’s foreign exchange markets are getting closely connected. Today we are gaining more insight into the technological infrastructure which the R5-SHCH Connect will use.

Chinese banks will use the Kx for Flow eFX trading platform developed by the Kx technology division of First Derivatives plc. R5 has already implemented the Kx technology to power the R5-SHCH FX Connect, enabling direct links between banks in China and London’s foreign exchange market.

Rich Kiel, Head of FX Solutions for Kx, commented: “The R5-SHCH FX Connect demonstrates how Kx technology continues to be at the forefront of technical innovation in electronic trading bringing these two important markets together while providing R5 with a platform for future growth.”

Kx for Flow has been one of the leading platforms in the institutional space. The product provides order management, trade execution, Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term, transaction analytics and alerts management. Clients using the R5-SHCH Connect will be executing their trades on a centrally cleared platform.

Solidifying the Importance of London as an FX Hub

The step is part of the continued effort on part of London-based fintech company R5 to continue the transformation of Emerging Markets foreign exchange from last century’s voice trading channels to new electronic trading.

The central clearing on the R5-SHCH FX Connect is executed via the Shanghai Clearing House. Mainland China banks are now able to trade G10 currencies using the London FX market’s well-developed infrastructure with tailored Liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term.

Currently, the first phase of R5-SHCH Connect has already gone live with eight Chinese banks connecting to the London FX market. Before the end of this year, a number of other onshore Chinese banks will be added to the marketplace.

Commenting on the news, the CEO of R5, Jon Vollemaere, said: "R5-SHCH Connect went live in a short timescale, the result of a good working relationship between R5, the Shanghai Clearing House, and Kx, which was efficient and highly responsive.”

“By using Kx technology R5-SHCH Connect is not only fast and robust, it gives us a foundation for future growth and expansion as we continue to transform Emerging Markets FX. We are particularly happy to be announcing this partnership today at the City of London RMB Roundtable at the Guildhall in London, in association with the People’s Bank of China,” Vollemaere elaborated.