LMAX Exchange CEO speaking at the World Exchange Congress – part 2

LMAX Exchange CEO, David Mercer, gave a speech at the World Exchange Congress 2015, on global capital markets and specifically about the FX market, the world’s largest asset class. David argues the practice of ‘Last Look’, which is a price with an option to reject or re-quote an order by market makers, that further drives down the level of transparency in the market and reduces the certainty of execution.

He continues, ‘last look’ is a relic of history and with it you can never prove best execution, it’s a one way option, to the benefit of a few but to the detriment of the many. FX should benefit from the transparency we see at every other asset class, there is no level-playing field in FX and the customer is beginning to react.

David states that the future of FX is on exchange and that the challenge is to create an exchange for the benefit of all, rather than the few. LMAX Exchange is a testament that the exchange style execution works and is the most efficient way to trade FX. Having the world’s top tier global banks and leading HFTs as Liquidity Providers, LMAX Exchange has been leading the FX industry’s evolution towards exchange style trading for the past 4 years. And unlike the ECNs, LMAX Exchange is authorised and regulated by the FCA as an MTF and has stringent regulatory requirements. LMAX Exchange is establishing the new exchange benchmark in FX trading and is addressing two main issues faced by clients trading FX 1) lack of price transparency and 2) lack of certainty of execution.