Bloomberg reports on how the FX market is changing to adapt to the 'rigging' scandals
(ps. Yeah .... time to play catch up with a few posts on items I've missed over the past few hours)
Bloomberg cite from a report by Greenwich Associates (a Stamford, Connecticut-based consultant, which produces market-share rankings in various asset classes)
Regulatory responses to "manipulation" is transforming how banks interact with FX clients,
- Traders and sales people are reluctant, or prohibited by bank policy, from commenting on market flow or proposing strategies that could present a conflict of interest ... "Dealers are distancing themselves from anything that could be perceived by regulators as compromising client confidentiality"
- Trades completed using online chat fell to 8 percent last year from 11 percent in 2013
- The volume of transactions through electronic platforms rose to 75 percent in 2014, from less than 60 percent in 2010 ... some investors may prefer to circumvent traders by using algorithms to execute orders at the fix
- Dealers may reduce staff in response to growing electronic trading and higher expenses
