Largest Global Currency Traders Limit “Last Look”
The Wall Street Journal reported yesterday that Thomas Reuters Corp. and BATS Global Markets Inc. plan to limit forex’s “last look,” on their currency-trading platforms. Although other foreign exchange (FX) platforms have eliminated this practice based on pressure from the Fair and Effective Markets Review,(FEMR) the impact has been insignificant as compared to the combined FX trading of Thomas Reuters and BATS. They represent close to 25 percent of clients’ electronic trading through FXall and Hotspot, owned by Thomas Reuters and BATS respectively.
Their goal is to provide greater transparency by reducing timeframes and acceptance rates, a change designed to impact the highly criticized industry practice, “last look”, where banks have the option to exit trades at the last minute based on information viewed on electronic communication networks (ECN).
FEMR, created nearly a year ago by the United Kingdom (UK) Treasury, Bank of England and Financial Conduct Authority (FCA), is scheduled to publicize findings on June 10, 2015, that are set to include currency trade execution rules.