CME Group launches new tool comparing FX listed futures and spot liquidity
Derivatives marketplace operator CME Group Inc (NASDAQ:CME) today announced the launch of the industry’s first tool to compare FX listed futures and spot liquidity on one screen – FX Market Profile.
The new tool, powered by Quant Analytics, a comprehensive FX analytics platform owned by CME Group, allows market participants to analyze trade flows and calculate execution efficiencies by benchmarking their performance against CME’s listed FX futures and EBS’s spot trading markets.
The FX Market Profile provides an hour by hour view of the trading day that compares the bid-ask spread of CME listed FX futures and spot FX on EBS markets at top-of-book, whilst also calculating a volume weighted average price to enable a more equivalent direct comparison. This data is available via intuitive charts and statistical plots, all built on Quant Analytics platform.
The FX Market Profile tool enables traders to compare and contrast CME’s leading FX products side-by-side in order to determine the optimal trading modality and time of day to transact in either market, calculate execution efficiencies, determine slippage costs, and minimize the market impact of trades.
“Synchronizing and displaying two of the largest primary FX markets side by side on a single platform highlights the complementary nature of the EBS spot and listed FX liquidity pools,” said Paul Houston, Managing Director, FX Products at CME Group. “With prices for 11 currency pairs, including EUR/USD, GBP/USD and USD/JPY, our new FX Market Profile tool will provide clients with greater transparency and help them to uncover new trading opportunities.”
“From a risk management and trade execution standpoint, this tool demonstrates where clients can achieve best execution for their FX trades,” added Jeff Ward, Global Head of EBS. “The tool provides data to help traders determine the optimal time of day to transact in either market, calculate execution efficiencies, determine slippage costs and minimize the market impact of trades.”
In 2020, CME Group has built new FX tools to help market participants analyze CME Group markets. For instance, in September this year, CME introduced its FX Options Vol Converter tool. It prices CME Group’s listed FX options liquidity in over-the-counter (OTC) terms, helping foreign exchange traders to more easily monitor price relationships, make more informed decisions across markets, and ensure best execution for their trading strategies.