In today’s electronic market, with its fast-paced nature, FX execution algo provides several benefits to investment managers, especially when it comes to processing large foreign exchange orders. Moreover, this execution algo can be beneficial for medium- to long-term investors that need to place large size orders as it minimises market impact on your trade.
In this blog, we explore why execution algos are needed, and explain why our trading automation software, CYBMIND, can help you deal with portfolio, order, and execution management.
Why FX Execution Algos Are So Crucial To Success
When an FX manager needs to place a large buy order, it’s pivotal that they try to minimise market impact to avoid driving the price up. This principle also applies to large sell orders, where the goal is to prevent the price from crashing.
Typically, a large order is divided into several smaller ‘clip’ ones executed over a set period of time; however, there isn't a one-size-fits-all rule for determining the sizes and timing of these orders.
Moreover, since the FX market is generally more liquid during the opening hours of the EU and US, but liquidity tends to decrease during the hours when the Asian market is open, things can vary significantly throughout the 24-hour trading day. And that’s not to mention how economic news released throughout the day, as well as more general news or even comments from high-profile players, can temporarily affect market behavior.
What all this means is that while an investment manager’s experience remains crucial to guiding the approach an order should take, it’s also important to monitor transaction costs.
CYBMIND Has Integrated FX Execution Algo
As a company that has merged its decades of financial knowledge with its expertise in technology, we knew that companies—particularly small- to medium-enterprises— require software that can keep up with the speed and volatility of the FX markets, helping them make better orders.
This is how we came up with our trading automation software, CYBMIND, into which we have integrated real-time portfolio management with order management and execution. Moreover, the analytics provided in real-time are an additional, valuable tool for monitoring the efficiency of your trading.
So, rather than outsourcing your execution to an external company or provider, you can integrate CYBMIND’s FX execution algorithm into your own system, maintaining control over the process.
Get In Touch For Next-Level FX Execution
CYBMIND, with its powerful tools and customisable features, can truly revolutionise the way you run your FX executions, giving you complete control and letting you turn your expertise into an algorithm that works for you. So, get in touch with us and discover all the benefits today!