Profit & Loss Events 2012 Yearbook by P&L Services Ltd.

PROFIT & LOSS

EVENTS

2012

YEAR BOOK SINGAPORE • BOGOTA • MEXICO CITY LONDON • NEW YORK • CHICAGO SANTIAGO • SAO PAOLO • TORONTO

PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS EVENTS 2012 YEARBOOK Profit & Loss is pleased to present the 2012 Forex Network and FX Growth Markets yearbook. Profit & Loss began hosting industry conferences in January 2000 with a standing room only series in London and New York that looked at “What is e-FX?” and featured a “whoʼs who” of e-FX in those early days. Over the past decade, our conference roster has grown to a dozen annual conferences, afternoon seminars and specialised workshops. In 2012, our annual Forex Network conferences in London, New York and Chicago drew record crowds, while our FX Growth Markets series drew growing participation across Latin America. Additional events in Singapore and Toronto were also very well received, and we look forward to adding new venues 2013, including a Scandinavian event in Copenhagen. Nearly 3,000 senior industry peers have joined us at conferences in Europe, Asia, North and South America throughout 2012. Profit & Loss Forex Network Chicago in particular has gone from strength to strength, and is currently the largest annual event for the wholesale FX industry globally, drawing nearly 600 people to our September conference. We hope you enjoy this roundup of the year, and will join us in 2013 for what promises to be another year of challenges and opportunities in the FX industry. Visit our website at www.profit-loss.com for programme, sponsorship and registration information for our 2013 events calendar.

CLOCKWISE FROM TOP: Standing room only at FXN New York 2012: Another full house for the business sessions in New York City FXN Chicago 2012: Conference Moderator Colin Lambert leads the discussion from the ﬂoor during a business session in Chicago Networking at FXN London 2012: Coﬀee break in the Exhibition Hall

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PROFIT & LOSS EVENTS 2012 YEARBOOK

THANKS TO OUR ANNUAL FOREX NETWORK 2012 SPONSORS: FOREX NETWORK PLATINUM SPONSORS

FOREX NETWORK GOLD SPONSORS

FOREX NETWORK SILVER SPONSORS

FOREX NETWORK SUPPORTING EXHIBITORS

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PROFIT & LOSS EVENTS 2012 YEARBOOK

THANKS TO OUR 2012 EVENT SPONSORS & PARTNERS:

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PROFIT & LOSS EVENTS 2012 YEARBOOK

contents: Profit & Loss Asia 2012 Singapore, February 16 . . . . . . . . . . . . . . . . . . . . . . . . 8 Profit & Loss Workshop: Trading the FX Asset Class - What You Need to Know New York, March 22 . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Forex Network FX Growth Markets Colombia 2012 Bogota, March 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Forex Network FX Growth Markets Mexico 2012 Mexico City, March 29 . . . . . . . . . . . . . . . . . . . . . . . . 13

Forex Network London 2012 London, April 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

P&L Digital FX Awards Dinner London, April 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Forex Network New York 2012 New York, May 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

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PROFIT & LOSS EVENTS 2012 YEARBOOK

contents: P&L Readersʼ Choice Digital Markets Awards Dinner New York, May 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Profit & Loss FX Workshop: Trading in the $5 Trillion/Day Market Chicago, June 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Forex Network Chicago 2012 Chicago, September 27-28. . . . . . . . . . . . . . . . . . . . . 26

Forex Network FX Growth Markets Chile 2012 Santiago, October 23 . . . . . . . . . . . . . . . . . . . . . . . . . 29

Forex Network FX Growth Markets Brazil 2012 Sao Paolo, October 25 . . . . . . . . . . . . . . . . . . . . . . . . 30

Profit & Loss Canada 2012 Toronto, November 15 . . . . . . . . . . . . . . . . . . . . . . . . 31

Profit & Loss Webinars: FX Aggregation without the Aggravation, May 30. . . . 32 The Future of FX Options, November 19 . . . . . . . . . . 32

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PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS FOREX NETWORK

ASIA 2012

SINGAPORE, FEBRUARY 16, 2012

Keynote address: Yeo Lian Sim, Chief Regulatory Oﬃcer, Singapore Exchange

Breakfast Session: A Focus on Platforms

Where is Asiaʼs Smart Money Heading Next? At Profit & Loss Forex Network Asia in Singapore, panellists shared their views on where the next opportunities are likely to be found. All were unanimous that “emerging markets somewhere” is where prospects are best, particularly as ratings are under pressure elsewhere. Emerging markets is the place to be, the panellists noted, as evidenced by record equity inflows into Asia in recent years. Whether European banks would take money out of Asia as a result of deleveraging, the consensus was that they would continue to be supportive of the region as a reflection of the resilience of Asia generally. Panel 1: Smart Money: Rick Lloyd, FX Analyst, Thomson Reuters; Olivier Desbarres, Director, Head of FX Strategy, Asia Paciﬁc ex-Japan, Barclays Capital

China and the Asia Story Bank of Singaporeʼs currency strategist Moh Siong Sim noted that the China story has important implications for the rest of Asia over the next decade. The cyclical question facing China is whether it should further cut rates – should it do so now in response to the slowdown, or should it hold back to get a soft landing and perhaps deflate some of the property bubble to prevent it becoming a problem later on? On a more structural level, the discussions looked at the rebalancing of global growth, as well as the rebalancing in Chinaʼs development model from an investment led model to one that is consumption based.

Panel 2: China & The Asia Story: Cindy Mok, Lead Policy Analyst, Prudential Policy Department, Monetary Authority of Singapore

Spotlight Presentation: Peter Slater, Deputy CEO and COO, CLS Group Holdings

The Future of OTC FX

Panel 3: Regulation & The Future of OTC FX Jim Giery, Director, APAC Global Client Solutions, Deutsche Bank; Nick Solinger, CMO, Traiana Inc; Robin Poynder, Head of Regulation, Marketplaces, Thomson Reuters

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Could US markets be the big loser when it comes to regulation? That was one of the questions posed to panellists at a session on the future of FX at Profit & Loss Forex Network Asia. The dangers of rulemaking, by the very definition of that process, start narrowing down what is available, agreed the panellists. The market has a number of different venues which exist for good reasons otherwise they wouldnʼt be there commercially. So naturally, there should be a number of different models and they reflect the different needs from different areas of commerce. Concerns about regulatory overreach were voiced, noting that while some parts of the proposed legislation could be useful to the market, after drilling down into the CFTCʼs rulemaking process, many of the new rules appear counterintuitive.

PROFIT & LOSS EVENTS 2012 YEARBOOK HFT in Asia – Are the costs too high? It is no surprise that high frequency trading has yet to really take off in many emerging markets for a variety of reasons. But one key reason people point to is that transaction costs are still too high to attract HFT to these markets in a big way. So what, if anything, might help improve high frequency trading activity to these regions? The key, says one high frequency trader based in Asia, is not so much to trade the emerging markets, but more about trading the G10 spot FX markets, as well as some CME FX futures. “Thereʼs nothing especially Asian about what we trade,” says the trader. “The only really Asian strategy we currently pursue is providing liquidity to a couple of regional brokers.“ But there are other factors beyond what makes sense to trade with high frequency, and there is little that can be done to circumvent an exchange that wonʼt allow traders to trade. Another trader says the Tokyo Financial Exchange (TFX) flat out refused the firmʼs business – either as a liquidity provider or taker. “We were told that they only allow major global banks and local players,” says the trader. “We brought some strategies in Asian equities and futures to the point of proofof-concept, but didnʼt find them lucrative enough to continue pursuing,” the trader continues. “High per-ticket costs is one annoying factor (as is a relatively small market), but the deal-killer was the lack of easy DMA [direct market access] in this region.” This trader says that up to a point, he can cope with high per-trade costs by just trading less, but that the exchanges seem to favour large banks and large local brokers –

Panel 4: The HFT-Bank Relationship: Counterparties or Competitors? Simon Winn, Head eFX Sales Asia, Commerzbank David Wallis, Head of FX Prime Brokerage (Asia), Morgan Stanley making it difficult, if not impossible, for small funds to connect quickly and easily. “Unlike the CME where I can easily write to their FIX API and trade directly on a level playing field, most Asian exchanges require small funds to connect via a broker whose API can add significant latency,” the trader says. “Naturally, fast brokers charge a premium for their services. Either way, my orders are behind the major players and for a higher cost. I have no interest in playing that game.“

The Liquidity Mirage: Alive & Well?

Panel 5: The Liquidity Mirage – Alive & Well? : Stamos Fokianos, Managing Director, Global Head of FX e-Trading, RBC Capital Markets; John Miesner, Managing Director, Global Head of Sales, Knight Hotspot FX

Is bank liquidity actually being abused? That was the opening question posed at the above-named panel at Profit & Loss Forex Network Asia in Singapore. The first place liquidity disappears is on the anonymous venues, noted Gaurav Malhotra, head of FX eTrading APAC at UBS, because there is no end-to-end relationship with the client. “Thatʼs why we consider bank liquidity more robust,” he said. Stamos Fokianos, MD, global head of FX e-Trading at RBC Capital Markets, added that today, there are secondary ECNs that have liquidity that you canʼt find on primary platforms. “Itʼs crazy, but itʼs true,” he said. “I think the reason for that is that you have clients who are being prime brokered, that are now putting up some interest that doesnʼt appear on the other platforms.

Exhibition & Technology Trade Show

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PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS WORKSHOP: TRADING THE FX ASSET CLASS: WHAT YOU NEED TO KNOW NEW YORK, MARCH 22, 2012 Regulatory Update

Robert Savage, CEO, Track.com • Tom Rogers, Community Manager, Americas Treasury, Thomson Reuters • Robert McKeon, Senior Vice President, Markets and Liquidity, FXDD • David Gilmore, Partner, Foreign Exchange Analytics

Connectivity & Rules of Engagement

Robert Savage, CEO, Track.com • Craig LeVeille, Director, FX Products, CME Group • Dave Reid, Director, FX Prime Brokerage, Citi • John Lloyd, Director of Product Marketing, Traiana

Best Execution

Robert Savage, CEO, Track.com • Andrés Choussy, Executive Director FX Prime Brokerage and Clearing, J.P.Morgan • Hayden Melton, Quantitative Trading Development Manager, Thomson Reuters • Joe Conlan, Global Head of Sales, FC Stone LLC

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PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS FX GROWTH MARKETS

COLOMBIA 2012 BOGOTA, MARCH 27

Keynote Address: Sandra Benítez, Director of Operations and Market Development, Central Bank of Colombia

Panel 1: Global Currencies Outlook Daniel Niño, Director of Economic Research and Strategies, Bancolombia Group Camilo Pérez Álvarez, Head of Economic Research, Banco de Bogotá Carmen Gloria Silva, FSR Editor, Senior Economist, Central Bank of Chile Greg Anderson, North America Head of G10 FX Strategy, Citi David Clark, chairman, The Wholesale Markets Brokersʼ Association

Panel 1: Global Currencies Outlook

Exhibition & Trade Show More from Colombia on p.12 >

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PROFIT & LOSS EVENTS 2012 YEARBOOK > Colombia continued from p.11

Panel 2: Regulation & Changing Market Structure Matt OʼHara, Senior Vice President Head of Marketplaces – Americas, Thomson Reuters Bradley Seelig,VP, Head of FX, Deutsche Bank Cesar Figueroa, Executive of Superintendent of Securities, Superintendencia Del Mercado De Valores Felipe Trujillo, Head of Derivatives, Colombia Stock Exchange David Clark, chairman, The Wholesale Markets Brokersʼ Association

Panel 2: Regulation & Changing Market Structure

Panel 3: The Future of Execution

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Matt OʼHara, Senior Vice President Head of Marketplaces – Americas, Thomson Reuters Andrés Macaya, Business Manager of SET FX – Spot Local Platform, Colombian Stock Exchange Edmundo Lizarzaburu, GFI Peru, General Manager, GFI Group Sandra M. Gaspar, Director - dbClear Global Client Clearing Sales, Deutsche Bank Dave Reid, Director, FX Prime Brokerage, Citi

PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS FX GROWTH MARKETS

MEXICO 2012 MEXICO CITY, MARCH 29

Keynote Address: Jaime Cortina, Director of Operations, Banco de México

Panel 1: Mexicoʼs Role on the Global Stage Conference Chairman: David Clark, Chairman, The Wholesale Markets Brokersʼ Association; Greg Anderson, North America Head of G10 FX Strategy, Citi; Gabriel Casillas, Executive Director, Chief Mexico Economist, J.P. Morgan; Alejandro Cuadrado, Head of FX LatAm Strategy, BBVA

Panel 1: Mexico’s Role on the Global Stage

Panel 2: The FX Asset Class Segundo Tascón Newton, Latin America Benefits Director, Towers Watson Mexico; Robert Savage, CEO, Track.com; Sergio Méndez, Portfolio Manager, Afore XXI Banorte

Panel 2: The FX Asset Class Panel 3: Regulation & Changing Market Structure Bradley Seelig, VP, Head of FX, Deutsche Bank Philip Harris , CEO, 360Trading Networks, Inc Matt OʼHara, Senior Vice President - Head of Marketplaces - Americas, Thomson Reuters

Panel 3: Regulation & Changing Market Structure More from Mexico on p.14 >

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PROFIT & LOSS EVENTS 2012 YEARBOOK > Mexico continued from p.13

Panel 4: High Frequency Trading Panel 4: High Frequency Trading Guillermo Camou, Director, MexDer, Scotiabank Global Banking and Markets Alfredo Guillén, Trading Director, Mexican Stock Exchange Danielle Tierney, Analyst, Aite Group

Spotlight Presentation Mark Sandomeno, Broker, Head of Mexican Interest Rates, GFI Group

Panel 5: The Future of Execution

Exhibition & Trade Show, GFI Cocktail Reception

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Michael Bernal, Sales Director, Latin America, FXall; Sandra-M. Gaspar, Director dbClear - Global Client Clearing Sales, Deutsche Bank; Jack Linker, Head of Liquidity Sales, Marketplaces , Thomson Reuters; Dave Reid, Director, FX Prime Brokerage, Citi

PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS FOREX NETWORK

LONDON 2012 LONDON, APRIL 18

Regulation Top of Discussions at P&L Forex Network London More than 300 attended Forex Network London to examine, discuss and debate the most pressing issues affecting the FX industry and to network with peers at P&L’s accompanying technology trade exhibition. The backbone of discussions at Profit & Loss Forex Network London focused on issues concerning how we, as an industry, are ready and able to meet the challenges of a new world, both from a regulatory and market perspective. Throughout the full day event, 300 market participants joined in the lively Q&A debates, which included views from the industry’s leading experts from platforms, banks and the buy side about the latest developments in the evolution of the FX industry, the changing landscape of the FX market and the likely impact of those changes on the business. The conference kicked oﬀ with a breakfast session sponsored by Caplin Systems that focused on “E-Commerce in a Cleared World”. Not many months ago, industry commentators were suggesting that a raft of new regulation would mean the end of the single dealer platform, but contrary to those suggestions global banks, and many smaller ones, are investing heavily in e-commerce infrastructure and front-end technology. The panel discussed why this is the case and identiﬁed what it is that those who are investing in the space have seen that the doomsayers have not. Panellists included Paul Caplin, CEO, Caplin Systems; David Holcombe, trading and markets principal, Rule Financial; James Taylor, global head of FX e-commerce distribution, JP Morgan; and David Bullen, inde-

pendent consultant with a focus on fixed income e-trading. “The challenges with regulations in the US and Europe caused people to pause in developing cross-asset single dealer platforms, but what we’re seeing is all of the tier one banks and some of the tier two banks investing heavily again in their platforms,” said Caplin. “This is partly because some of the top tier banks have come out and said they intend to be SEF aggregators. They expect the market to fragment, they expect liquidity to be increasingly widespread and they think there will be a role for them in an agency brokerage-type capacity, aggregating liquidity from multiple SEFs and providing smart order routing to those.” Other topics under the spotlight included divergence in regulation and regulatory arbitrage, key relationship staff being able to reach more clients through technology, e-commerce in a cleared world and the associated experience for real economy end users. The first panel of the day – ‘The Fireside Chat’ with David Clark, chairman of the Wholesale Markets Brokers’ Association – examined the key challenges of making FX markets safer. David Thomas, programme manager of the Depository Trust and Clearing Corp’s FX Trade Repository gave a presentation on where the different regulatory regimes are up to in terms of trade reporting rules and gave an overview of DTCC’s trade information warehouses, which elec-

E-commerce in a Cleared World

(L-R): James Taylor, global head of FX e-commerce distribution, JP Morgan; David Holcombe, trading and markets principal, Rule Financial; Paul Caplin, CEO, Caplin Systems; and David Bullen, independent consultant, ﬁxed income e-trading.

Profit & Loss held a special breakfast session, sponsored by Caplin Systems, at Forex Network London 2012, that looked at e-commerce in a cleared world. David Holcombe, trading and markets principal at Rule Financial, discussed the three stages of evolution of the singledealer platform, while James Taylor, global head of FX e-commerce distribution at JP Morgan compared the e-commerce businesses of fixed income and FX. The panellists were asked how second tier banks would compete with top tier banks, with Paul Caplin, CEO of Caplin Systems, saying that second tier banks have learnt technically how to aggregate liquidity, make prices and manage risks in a reliable way that previously only the top tier banks were able to do. When asked if the experience of the end client is improving, Caplin said that as costs are being squeezed, banks have had to find ways of making client relationship management more efficient. Banks are competing more imaginatively and aggressively in how they serve clients, he noted.

The Profit & Loss Discussion Andres Choussy (far right), global head of FX clearing, JP Morgan, and Luke Kolter (middle), commercial director for EMEA, DealHub, discussed how prepared the FX industry is for mandatory clearing of certain products at Forex Network London 2012. Choussy noted that the FX industry has significantly benefitted from the work done in other asset classes including preparations around trade flows, risk management principles and membership requirements of clearing houses. This has allowed FX to have a much shorter time to market with clearing but, he warned, this shortened time frame could introduce a level of risk to the industry.

The Proﬁt & Loss Discussion with (l-r) Colin Lambert, Proﬁt & Loss; Luke Kolter, DealHub and Andres Choussy, JP Morgan

More from London >

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PROFIT & LOSS EVENTS 2012 YEARBOOK Challenges Facing the Global Market

CHALLENGES FACING THE GLOBAL FX MARKET: The P&L Fireside Chat with David Clark, chairman, The Wholesale Markets Brokers’ Association, featuring (L-R): David Thomas, programme manager FX trade repository, DTCC; Gavin Wells, CEO, ForexClear, LCH.Clearnet; Robin Poynder, head of regulation, Marketplaces, Thomson Reuters.

Robin Poynder, head of regulation, Marketplaces, Thomson Reuters, David Thomas, programme manager, FX Trade Repository, DTCC, and Gavin Wells, CEO, ForexClear, LCH.Clearnet, discussed issues surrounding FX clearing and reporting at Forex Network London 2012. According to Poynder, the mandatory reporting of FX trades will create a huge infrastructure cost that many banks have not yet realised, particularly as the reporting mandate is broader than the mandate for clearing instruments. Wells said that the technology is there to clear FX options and if the central banks that oversee CLS decide there is an appropriate way to allow CCPs to access CLS, then FX options could be cleared by the end of 2013.

BUILDING A SINGLE BANK PLATFORM FOR THE DODDFRANK ERA: L-R: Vince O’Sullivan, director, e-FX distribution, Europe, Barclays Capital; Lee Oliver, director, CitiFX Wire, Citi; Liam Hudson, MD, global head of e-trading, Bank of America Merrill Lynch; Jason Vitale, global head of FXPB & FX OTC Clearing, Deutsche Bank; Robin Manicom, director of ﬁnancial services, EMEA, Equinix.

tronically store the details of various types of derivatives traded overthe-counter. He was joined on stage by Robin Poynder, head of regulation, Marketplaces at Thomson Reuters and Gavin Wells, CEO, ForexClear at LCH.Clearnet for a lively discussion and question and answer session. The panellists discussed, among other topics, the costs of clearing, how the data that trade repositories receive will be shared and how quickly FX options are likely to be cleared. Poynder said he could not see FX options being cleared within the next couple of years because of their cash settled nature and also due to delta hedge management. Wells said: “I think it comes down to whether the CFTC backtracks and takes options out or whether the central banks who oversee CLS decide that there is an appropriate way to allow CCPs to access CLS. If there is, and we might hear at the end of the year, then I think FX options could be cleared by the end of 2013.” ‘The Profit & Loss Discussion’, sponsored by DealHub, and featuring panellists Andrés Choussy, global head of FX clearing, JP Morgan, and Luke Kolter, commercial director for EMEA at DealHub, examined the challenges facing post-trade providers and how they are building efficiency into the infrastructure to meet those challenges. The second panel of the day – ‘The Sea Change’, sponsored by Traiana – featured a stellar line up of panellists who discussed, among many things, whether banks have lost some ownership of the market making function, the real market impact of internationalisation and whether internalisation of flows by banks has been a reaction to high frequency traders or a natural advance in risk management techniques. Also under the spotlight were fifth decimal pricing and agency and principal products and services. Panellists included Mark Meredith, head of e-FX quantitative analytics, UBS; Ed Mount, head of technology-based trading, Royal Bank of Scotland; Nick Solinger, chief marketing officer at Traiana; and LCH.Clear-

net’s Wells, CEO, ForexClear. As the industry braces itself for regulation, the third panel discussion, entitled ‘The Road Ahead’, examined the future of FX options through the eyes of those leading innovation in the space. Panellists including Roger Rutherford, managing director, FX products, CME Group; Joerg Schmuecker, fixed income derivatives e-commerce product head at Credit Suisse; Mark Suter, founder and CEO, Digital Vega; and Paul Millward, head of FX technology, GFI Group, discussed the specific requirements of a SEF in FX options, how an FX options SEF looks compared to the current models and how banks are leveraging their proprietary FX options offerings. The penultimate panel, ‘Surviving the Perfect Storm – ECNs, SEFs and a New Platform Market’ – featured a range of speakers who discussed the key benefits of a SEF, what it takes for a platform to stay competitive, whether quality of liquidity has come under pressure in the HFT era, the 15-second rule and “bank ECNs”, among other topics. Panellists included Thomson Reuters’ Poynder; Steve Toland, head of exchange strategy, LMAX; Jeff Ward, executive vice president and global sales manager, Icap; and David Woolcock, senior director, bank sales at FXall. In the second P&L Discussion of the day, Colin Lambert and Paul Caplin of Caplin Systems had an in-depth discussion on the pitfalls to watch out for in “Creating a Single Bank Platform”. The conference closed with a live video-streamed panel entitled ‘Building a Single Bank Platform for the Dodd-Frank Era’, sponsored by Equinix. A panel of experts including Liam Hudson, global head of e-FX trading, Bank of America Merrill Lynch; Lee Oliver, director, CitiFX Wire, Citi; Vince O’Sullivan, director and head of Barx sales, Europe at Barclays; Jason Vitale, global head of FX prime brokerage and FX OTC clearing, Deutsche Bank; and Robin Manicom, director of financial services, EMEA, Equinix, attempted to create the perfect single bank

Watch the videos from these panels on the P&L website: www.proﬁt-loss.com/?q=forex/videos

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PROFIT & LOSS EVENTS 2012 YEARBOOK

Surviving the Perfect Storm - ECNs, SEFs and a New Platform Market: L-R: David Woolcock, senior director, Special Address by the Lord Mayor bank sales, FXall; Robin Poynder, head of regulation, Marketplaces, Thomson Reuters; Steve Toland, head of Rt. Hon., the Lord Mayor of the City of exchange strategy, LMAX; Jeﬀ Ward, EVP, global sales manager, Icap. London, Alderman David Wootton

Derivatives: The Road Ahead: L-R: Mark Suter, founder & CEO, Digital Vega; Roger Rutherford, MD, FX products, CME; Joerg Schmuecker, FID e-commerce product head derivatives, Credit Suisse; Paul Millward, head of FX technology, GFI Group.

The Proﬁt & Loss Forex Network Technology Trade Show More from London >

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PROFIT & LOSS EVENTS 2012 YEARBOOK

platform, from pre-trade to post-trade and prime brokerage with all the pricing and execution tools in-between. The panellists discussed the challenges of silos within banks when potentially customers are looking for a more integrated solution across multiple markets that they can map onto their workflow and ways to make the platform bullet proof for regulation. Profit & Loss was honoured to have the Rt. Hon., the Lord Mayor of the City of London, Alderman David Wootton address attendees during the cocktail reception at the close of the conference. In the name of charity, Forex Network London also played host to some head-shaving entertainment when Markitserv’s Nick Dyne and Keith Tippell faced the clippers to raise money for the St Baldrick’s Foundation and Cancer Research UK. P&L Digital FX Awards Winners The Digital FX Awards Dinner followed the Forex Network event with Barclays winning the Best Platform award for Barx – the fifth time it has won the top category. Barclays carried away four awards in total including Best Rates Platform, Best Emerging Markets Platform and Best Structured Products Platform. After 11 years of awarding banks for excellence in their ecommerce offerings, only three have carried off the top Profit & Loss prize, with UBS the winner in the first four years, followed by Deutsche Bank for its Autobahn FX platform. The night was one to remember for Citi, which walked away with three awards, including Best FX Platform – the second of the ‘Big Two’ awards – for Velocity. In addition, it was awarded Best Corporate Platform and 18

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Best Retail FX Platform for CitiFX Pro. Credit Suisse, Deutsche Bank, JP Morgan, Goldman Sachs, UBS and Nomura received two awards each while Bank of America Merrill Lynch, BNP Paribas, Morgan Stanley and Lloyds Bank were presented with an award each for their efforts in FX e-commerce. “The first thing to say about this year’s awards is what a difference a year makes. This time last year we reported on an uncertain regulatory environment that was casting a long shadow over the single bank platform industry amid fears that much of its functionality could be assigned to the scrap heap. Roll forward one year and a much greater sense of optimism is apparent,” says Colin Lambert, editor of Profit & Loss. “This optimism is reflected in more banks rolling out platforms for their clients, existing banks making a huge effort to climb the ladder – and those at the top enhancing their products even further. “One thing that has become apparent in this year’s process is it is very difficult to catch up once you fall behind. While we see early mover advantage existing, the real advantage appears to have been maintaining expenditure throughout the financial crisis (and in some cases for years before that). More than ever, looking across the industry, we can state with some confidence that an ongoing and aggressive technological program – along with ongoing and aggressive spend – is required. It is very easy to fall behind in this game; it is very difficult to catch up,” he says. Full details of the winners, their platforms and details of the close contenders are available in the April issue of Profit & Loss. Profit & Loss would like to thank all those who donated prizes for the auction and raffle on the evening. More than £2000 was raised for the Lord Mayor’s Appeal 2012.

PROFIT & LOSS EVENTS 2012 YEARBOOK

THE 2012 P&L DIGITAL FX AWARDS DINNER LONDON, APRIL 18

VIEW MORE PHOTOS FROM THE DIGITAL FX AWARDS DINNER ON THE P&L WEBSITE: http://www.proﬁt-loss.com/?q=events

THE 2012 DIGITAL FX “EYE ON THE CLIENT” AWARDS WINNERS LISTING Best Platform Best FX Platform P&L’s Innovation Award Best FX Options Platform Editor’s Choice Award P&L’s One to Watch in 2012 Best Mobile Platform Best Rates Platform Best Commodities Platform 2012 Product of the Year

Barclays Capital Citi The Royal Bank of Scotland Bank of America Merrill Lynch Credit Suisse Deutsche Bank JP Morgan Barclays Capital Goldman Sachs Credit Suisse

CLIENT SEGMENT AWARDS Best Banks Platform Best Corporate Platform Best Real Money Platform Best Leveraged Sector Platform Best Traders’ Platform Best Retail Platform Best Emerging Markets

Goldman Sachs Citi UBS Deutsche Bank Nomura Citi FXPro Barclays Capital

SERVICES 2012 Post Trade Award Best Execution Best Execution Functionality Best Order Management Best Research Portal Best FX Prime Brokerage Best Structured Products Platform Best Navigation

UBS JP Morgan Nomura The Royal Bank of Scotland BNP Paribas Morgan Stanley Barclays Capital Lloyds Bank

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PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS FOREX NETWORK

NEW YORK 2012 NEW YORK, MAY 31

Breakfast Session: “Evolving Platform Technology & New Markets” Caplin Systems’ sponsored breakfast session featured, (L-R): Raj Iyer, VP, Global Markets Product Management, BNY Mellon Global Markets; Thomas Lo, Founder and CEO, Financialogix Group; Jose Cadalzo, US General Manager, Caplin Systems; Moderator: Colin Lambert, Editor, Proﬁt & Loss

The Proﬁt & Loss Interview: Agency vs Principal Models “Update from Washington” Mike Gill, Senior Policy Advisor, Crowell & Moring

In an interview with Ray Kamrath, CEO of Faros Trading, and Tom Parry, FX quant trader at Bank of America Merrill Lynch, at Proﬁt & Loss Forex Network NYC 2012, the pair discussed the future of liquidity provision and the crucial role FXPB is likely to play in the future.

The Profit & Loss Debate

The Proﬁt & Loss Debate: “Fragmentation and future liquidity” Colin Lambert, Editor, Proﬁt & Loss; James Sinclair, CEO & Co-Founder, MarketFactory, Inc.

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Fragmentation and future liquidity were the topics for debate between P&Lʼs own Colin Lambert and founding CEO of MarketFactory, James Sinclair, at Profit & Loss Forex Network NYC 2012. Set against the backdrop of the FX industryʼs long history of innovation, Lambert and Sinclair voiced their opinions about the new platforms entering the market, as well as the impact of further fragmentation. Although the pair differed on the future evolution of the industry, one point of general agreement was that while regulation could cause changes in trading, it wonʼt stop the marketʼs growth.

PROFIT & LOSS EVENTS 2012 YEARBOOK Will Dodd-Frank Radically Alter FX?

Panel 1: Global Positioning: How can the US protect its position in global foreign exchange markets?

Five years from now, FX trading could be radically altered by Dodd-Frank contended panellist Thomas Farley, senior vice president of financial markets at ICE (previously president, ICE Futures US) at Profit & Loss Forex Network NYC 2012. According to Farley, spot, forwards and swaps will move to central clearing; there will be significantly more FX futures trading than there is today; and the average tenor of trades will increase significantly, he said. Fellow panellists Chris Ferreri, chairman of the Wholesale Markets Brokersʼ Association Americas and Tom Rogers, community manager at Thomson Reuters, disagreed with some of those assumptions, questioning the value of centralising risk into fewer clearing house buckets.

L-R: Thomas Farley, President, ICE Futures US; Christopher Ferreri, Chairman, The Wholesale Markets Brokers' Association Americas, and Managing Director, ICAP North America; Tom Rogers, Community Manager Americas, Marketplaces, Thomson Reuters

Differentiation a Challenge in Face of Clearing Will consolidation around clearing change which banks dominate in execution? That question was posed to panellists at Profit & Loss Forex Network NYC 2012. Brad Seelig of Deutsche Bank suggested the industry will respond with new services to differentiate themselves through collateral transformation, execution tools and cash management. Fellow panellist Nick Dyne of MarkitServ warned that many market participants still donʼt realise how quickly they need to act, claiming there is a complacency about how much work needs to be done.

Panel 2: Gateway to the “New” World Nick Dyne, Co-Head MarkitSERV FX, MarkitSERV; Bradley Seelig, Head of FX PB, Americas, Deutsche Bank; Nick Solinger, Chief Marketing Oﬃcer, Traiana Inc; Gavin Wells, CEO, ForexClear, LCH.Clearnet

The Proﬁt & Loss Forex Network Technology Trade Show

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PROFIT & LOSS EVENTS 2012 YEARBOOK > New York

Making Markets in an Electronic World

Panel 3: Making Markets in an Electronic World L-R: Simon Jones, Global Head of FX eTrading, Citi; Chris Concannon, Partner, Virtu Financial; Peter Atkinson, Head of FX Products Management, smartTrade; Christopher Purves, Managing Director – Global Head of FX E-Trading, UBS

Is spread compression the biggest challenge the industry faces? At Profit & Loss Forex Network NYC 2012, panellist Chris Concannon, CEO at Virtu Financial, asked whether, as spreads continue to compress, is the future of market making about who can make spreads and turn a profit at the same time, or is it a question of making spreads and customised liquidity? Fellow panellist John Crouch of Credit Suisse, argued that internalisation provided an opportunity, while counterpart Chris Purves of UBS argued that there is a case against consoliating all of a bankʼs liquidity internally.

FX Options – Biggest Area of Fragmentation? With as many as 17 new venues for the FX options market currently in the works, volume growth for the industry went under the microscope at Profit & Loss Forex Network NYC 2012. Increases in speculative flows, smaller mid-tier funds, corporations increasing hedging activities and regulations will all work to increase volumes in the FX options maket, said Paul Millward at GFI Group. Fellow panellists all agreed that no matter what the future holds, electronically traded options will be the big driver for change.

Panel 4: Derivatives: The Road Ahead L-R: Mark Schlater, Managing Director, FX & PM Derivatives, UBS Investment Bank; Paul Millward, Head of FX Technology, GFI Group; Craig LeVeille, Executive Director, FX Products, CME Group

SEFs, ECNs and Other Acronyms What challenges will the increasing number of trading venues coming into the FX market pose to existing industry players? Will the future of the platform world be about scale? Panellists at Profit & Loss Forex Network NYC 2012 sought to predict the future of the industry, as well as the scene if the expected FX exemption does not materialise.

Panel 5: SEFs, ECNs and Other Acronyms L-R: Ed Brown, EVP of Business Development & Research, ICAP • Matt O’Hara, Senior Vice President, Global Head of Business Operations, Marketplaces, Thomson Reuters • Jim Kwiatkowski, Global Head of Sales, FXall • John Miesner, Managing Director, Knight Hotspot FX

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PROFIT & LOSS EVENTS 2012 YEARBOOK 2012 Profit & Loss Readers’ Choice

Profit & Loss Readers’ Choice

Digital Markets Awards 2012 For the fifth consecutive year, Profit & Loss opened its website in April and May for readers to vote for the best bank, broker and service provider across 15 key categories in the FX industry. This year, more than 13,000 votes were registered making it the largest response to date for the awards. The winners of the 2012 Readers’ Choice Digital Markets Awards, along with the Class of 2012 Hall of Fame inductees, were unveiled at a dinner and ceremony on May 31, following Forex Network New York.

Clockwise from top: Bank of America Merrill Lynch; Dealhub; 360T; Thomson Reuters; Citi; Currenex; GFI

rofit & Loss unveiled the winners of its 2012 Readers’ Choice Digital Markets Awards at a dinner and ceremony on 31 May after Forex Network New York with Barclays and Citi scooping four awards each. In the bank provider categories, Barclays won Best Multi-Asset Class Platform, the Digital Markets Innovator Award, Best Options Trading Platform and Best Trading Platform for Corporates (it was a

joint winner with Bank of America Merrill Lynch). Citi received awards for Best FX Prime Brokerage, Best Retail FX Platform, Best Matching Platform and Best Order Management. UBS was voted Best Post-Trade Services provider and won the Best Risk Management System award. Deutsche Bank won Best Trading Platform for Hedge Funds and Best Trading Platform for Asset Managers while the Royal Bank of Scotland won Best

The Profit & Loss Hall of Fame “Class of 2012” In 2009, Profit & Loss celebrated its 10th anniversary by establishing the Profit & Loss Hall of Fame, which recognises those individuals who have made significant contributions to the growth of the foreign exchange industry. The Class of 2012 continues to reflect that ethos, comprising people who have long been held in great esteem by peers and colleagues, both professionally and personally. It is with great pleasure that we unveil the next four members of our industry to be honoured in the Profit & Loss Hall of Fame:

Michael deSa

David Ogg

John Taylor

Tony Dalton

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PROFIT & LOSS EVENTS 2012 YEARBOOK > New York

Liquidity Aggregation Platform and JP Morgan received the Best Algorithmic Trading System award. DealHub beat off competition to win the Best Post-Trade Services award while Currenex won the Best Trading Platform for Hedge Funds award and 360T received an award for Best Trading Platform for Corporates. FXall won the Best Trading Platform for Asset Managers. Other winners on the night included EBS for Best Matching Platform; Thomson Reuters for Best Liquidity Aggregation Platform and Best Market Data Platform; GFI Group for Best FX Options Platform and Best Risk Management System; State Street

eExchange for Best Multi-Asset Class Platform; and Alpari (UK), which received an award for Best Retail FX Platform. Progress Apama, FC Stone, Barracuda FX and Gold-i also received awards. For the fifth consecutive year, Profit & Loss opened its website in April and May for readers to vote for the best bank, broker and service provider across 15 key categories. This year, more than 13,000 votes were registered making it the largest response to date for the awards. Find more photos on P&Lʼs Facebook page: facebook.com/profitandloss

DIGITAL MARKETS AWARDS WINNERS 2012 Best Trading Platform for Corporates

Best Post-Trade Services

Best Options Trading Platform

Bank Providers 1=: Barclays 1=: Bank of America Merrill Lynch 3: Citi Non-Bank Providers 1: 360T 2: FXall 3: Currenex

Bank Providers 1: UBS 2: Citi 3: Deutsche Bank Non-Bank Providers 1: DealHub 2: MarkitServ 3: FXall

Bank Providers 1: Barclays 2: Deutsche Bank 3: UBS Non-Bank Providers 1: GFI Forex Match 2: Surface Exchange 3: Digital Vega

Best Trading Platform for Hedge Funds

Best Multi-Asset Class Platform

Best Liquidity Aggregation Platform

Bank Providers 1: Deutsche Bank 2: Citi 3: Barclays Non-Bank Providers 1: Currenex 2: Hotspot 3: FXall

Bank Providers 1: Barclays 2: JP Morgan 3: Deutsche Bank Non-Bank Providers 1: State Street eExchange 2: CME 3: Bloomberg

Bank Providers 1: The Royal Bank of Scotland 2: Citi 3: JP Morgan Non-Bank Providers 1: Thomson Reuters Dealing Aggregator 2: SmartTrade 3: Integral

Best Platform for Asset Managers

The Digital Markets Innovators Award

Best FX Prime Brokerage

Bank Providers 1: Deutsche Bank 2: Barclays 3: UBS Non-Bank Providers 1: FXall 2: FX Connect 3: Currenex

Bank Providers 1: Barclays 2=: Citi 2=: Goldman Sachs Non-Bank Providers 1: Gold-i 2: Surface Exchange 3: Russell

Bank Providers 1: Citi 2: UBS 3: Morgan Stanley Non-Bank Providers 1: FC Stone 2: Traiana 3: NewEdge

Best Retail FX Platform

Best Risk Management System

Best Order Management

Bank Providers 1: Citi 2: Barclays 3: Saxo Non-Bank Providers 1: Alpari (UK) 2: FXCM 3: Pepperstone

Bank Providers 1: UBS 2: Citi 3: Goldman Sachs Non-Bank Providers 1: GFI Fenics 2: Thomson Reuters 3: Currenex

Bank Providers 1: Citi 2: Deutsche Bank 3: Barclays Non-Bank Providers 1: Barracuda FX 2: TraderTools 3: Currenex

Best Matching Platform

Best Algorithmic Trading System

Best Market Data Service

Bank Providers 1: Citi 2: Deutsche Bank 3: JP Morgan Non-Bank Providers 1: EBS 2: Thomson Reuters Matching 3: Currenex

Bank Providers 1: JP Morgan 2: Credit Suisse 3: Citi Non-Bank Providers 1: Progress Apama 2: Flextrade 3: Thomson Reuters

Non-Bank Providers 1: Thomson Reuters 2: Bloomberg 3: GFI

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PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS FX WORKSHOP: TRADING IN THE $5 TRILLION/DAY MARKET CHICAGO, JUNE 13

Panel 1: “Trending Business Issues Guiding Legal Solutions” Moderator: James Fischer, Esq, Partner, Drinker Biddle & Reath LLP; Ira Kalina, Esq, Drinker Biddle & Reath LLP; Vincent Sangiovanni, Chief Operating Oﬃcer, GAIN GTX

“Ensuring your Firm is Properly Set Up and Addressing Growth Plans” James Fischer, Esq, Partner, Drinker Biddle & Reath LLP

“Prime Brokerage and Trading in a Fragmented Market” Moderator: Colin Lambert, Editor, Proﬁt & Loss; James Sinclair, CEO & Co-Founder, MarketFactory, Inc; Dave Reid, Director, FXPB, Citi; Jordan Hamowy, Director of FX Product Marketing, Traiana

Panel 2: “Which FX Venues Best Suit Your Trading Style?” Moderator: Colin Lambert, Editor, Proﬁt & Loss; Craig LeVeille, Executive Director, FX Products, CME Group; John Miesner, Managing Director, Global Head of Sales, Knight Hotspot FX; Tom Rogers, Community Manager Americas, Marketplaces, Thomson Reuters; Dan Torrey, Head of Sales - Americas, ICAP EBS

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PROFIT & LOSS EVENTS 2012 YEARBOOK

PROFIT & LOSS FOREX NETWORK

CHICAGO 2012 CHICAGO, SEPTEMBER 2728

Keynote: Market Vulnerability and High Speed Trading Carol Clark, senior policy specialist at the Federal Reserve Bank of Chicago, made the opening address at Profit & Loss Forex Network Chicago. In her speech, which focussed on Market Vulnerability and High Speed Trading, Clark noted that there is cause for concern because of the frequency of market mishaps that are occurring at seemingly reputable firms and focussed on where responsibility lies in setting controls at all levels of the trading lifecycle. One area she highlighted in particular was that high frequency traders apply fewer pre-trade risk strategies in order to reduce latency, and that she hopes the new rules will address this practice.

Keynote Address: Carol Clark, Senior Policy Specialist, The Federal Reserve Bank of Chicago

Connectivity in a Fragmented World In a discussion between Nick Dyne (far right), MD and cohead of MarkitSERV FX, and Nick Solinger (middle), chief marketing officer at Traiana, at Profit & Loss Forex Network Chicago, the pair discussed a range of Dodd-Frank issues, including that pertaining to NDFS. According to Dyne, it is a great pity the regulators decided to pick on NDFSs as something to be the vanguard of the changes, because thereʼs no money in it, thereʼs not enough volume, and not very much liquidity. It has all the wrong characteristics to find itself being the instrument type thatʼs the first to do the change, he added. The real risk, he said, is that unless they do the mandating soon, people are going to lose interest in the problem, because thereʼs no way they are going to make money in it, because it just becomes a chore. Solinger Challenges Dyne to Sparring Match At the close of the P&L Discussion, Solinger challenged Dyne to a sparring match at the next Profit & Loss event in 2013. Solingerʼs tactic, he said, would be to run around the ring in an attempt to run down the time, to which Dyne agreed might actually work, since he doesnʼt actually run.

The P&L Discussion: “Connectivity in a Fragmented World” Nick Solinger, Chief Marketing Oﬃcer, Traiana Nick Dyne, Managing Director and Co-Head, MarkitSERV FX

The P&L Interview: Is the World Coming to Chicago? In a one-on-one interview between Profit & Lossʼs editor Colin Lambert and Derek Sammann, senior managing director of interest rate and FX products at CME Group, at Profit & Loss Forex Network Chicago, Lambert asked whether there is a sense for optimism, despite the changes facing the industry. Sammann replied that the trends CME is seeing does indeed give him a sense of optimism in terms of how people are pre-positioning themselves ahead of regulations. However, as more risk than ever before is coming into the CME, Sammann cautioned that “[regulations] are changing a market structure that has been in place and worked very well for a good many years in FX”.

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Is the World Coming to Chicago? Derek Sammann, Senior Managing Director, Interest Rate and Foreign Exchange Products, CME Group

PROFIT & LOSS EVENTS 2012 YEARBOOK

The P&L Interview: The Evolution of EBS In an interview with Gil Mandelzis, CEO of EBS and executive chairman of Traiana, Colin Lambert, editor of Profit & Loss, discussed Mandelzisʼ plans for the industryʼs largest spot matching platform. “It is time for us to start thinking about different microstructures,” he said, noting that EBS will be making announcements to this effect during the remainder of this year and next that reflect this philosophy. Mandelzis suggested that the massive fragmentation in the market will soon be a thing of the past, and went so far as to say that despite the lower FX volumes seen recently, next year or the year following will see growth again in global trade. “And when the market does come back, FX will be a great market to be in,” he said, concluding with a prediction that in the next five to 10 years, we are going to see $6 trillion/day in daily FX turnover.

The P&L Interview with Gil Mandelzis, CEO, EBS Panel 1: Market Making in an Electronic World Bank and non-bank marketing makers came together to discuss regulation, fragmentation and risk management at Profit & Loss Forex Network Chicago, which drew a crowd of nearly 600 to the Windy City in September. Chris Concannon, partner at Virtu Panel 1: “Market Making in an Electronic World” Financial; Peter Nabicht, executive L-R: Greg Wood, Director, Algorithmic Execution, Foreign Exchange and Listed Derivatives, Deutsche vice president at Allston Trading; Bank; Chris Concannon, Partner, Virtu Financial; Christopher Purves, Managing Director – Global Head of Chris Purves, MD and global head FX E-Trading, UBS Investment Bank; Peter Nabicht, Executive Vice President, Allston Trading of FX e-trading at UBS Investment Bank; and Greg Wood, director, algorithmic execution, FX and listed derivatives at Deutsche Bank, started the session looking at the benefits of more regulation to the sector. Fragmentation within the FX market led to discussions on IT risk management, with Purves suggesting that the industry would benefit by defining a common mechanism for connectivity and therefore avoiding the need to recode every time a platform adds a new feature.

Panel 2: Patents vs Trade Secrets John Mulcahy, associate at Finnegan, discussed the differences between patents and trade secrets at Septemberʼs Profit & Loss Forex Network Chicago. Mulcahy said the question between the two comes down whether the invention in question is patentable and wither it can be kept a secret. He also discussed key differences between European and US laws on when you file for a patent.

Panel 2: “\algblockdefx[<block>]{<start>}{<end>}: Who Owns the Code?” John Mulcahy, Associate, Finnegan; Thomas Rayski, Counsel, Dechert LLP

Panel 3: “KYC: Keeping Your Customer” L-R: Jorn Sodborg (Luﬀe), chief dealer, spot FX, Jyske Bank; Takis Spiropoulos, MD, Global Head, e-Commerce Solutions, CIBC; Harry Gozlan, CEO, smartTrade; Bryan Hunter, MD, eCommerce, Fifth Third Bank

Panel 3: “KYC: Keeping Your Customer”

The Proﬁt & Loss Forex Network Technology Trade Show

In a panel looking at the role of the second tier bank, speakers at Profit & Loss Forex Network Chicago looked at the role aggregation has to play in the life of the lower tier bank operator. Aggregation is very important, said Takis Spiropoulos, managing director and global head, e-Commerce Solutions at CIBC World Markets, but argued against co-mingling of different liquidity pools. In discussing the role of the single dealer platform, Jorn Sodborg (Luffe), chief dealer, spot FX, at Jyske Bank in Copenhagen noted that while it formed an important part of a bankʼs offering in the early days of e-FX, he was unsure about the benefit going forward in light of increasing regulatory and compliance requirements.