[ T R A D E T E C H
OUTSOURCING CRUCIAL
AS INDUSTRY SHIFTS
FROM BEST EXECUTION TO
SMART EXECUTION
MARKET PARTICIPANTS AGREE THAT TRUST IS A
KEY ASPECT FOR FIRMS LOOKING TO WORK WITH
TECHNOLOGY PROVIDERS ON THEIR EXECUTION
PROCESSES.
F X
U S
2 0 1 9 ]
mately comes down to how bespoke
or unique a firm’s need is.
“For me, it’s important to selec-
tively outsource where you don’t
have the expertise to do certain
things,” Michael O’Brien, global
head of trading at Eaton Vance,
told delegates. “I don’t know how
to code, so if someone can build
something that will help me with a
particular task then great. But when
it comes to the execution process,
you have to be extremely sensitive
about who you work with. Away
from execution, it’s easier to choose
your partners.”
Panellists also agreed that it can
be challenging to navigate the array
of technology providers currently
available in the market. Trust was
also labelled a key aspect when
“When it comes to the
execution process, you
have to be extremely
sensitive about who
you work with.”
MIKE O’BRIEN, EATON VANCE
A
s the industry shifts from
meeting best execution
requirements towards smarter
execution processes, FX market
participants have agreed that
outsourcing will play a key role for
both buy- and sell-side firms.
Panel speakers said that the trend
towards outsourcing portions of the
smart execution process to special-
ists will become more prominent, as
firms often don’t have the resources
to build technology or develop the
smart execution process they need
in-house.
“It’s about working with vendors
who specialise in things like aggre-
gation, analytics, smart execution,
and that has to be part of the evo-
lution because it’s impossible to do
everything in-house,” said Danielle
Caravetta, director of global sales
at Pragma Securities. “It takes too
much time, too much money, and
everyone is doing more with less, so
you have to be smart about who you
partner with. Most of the specialists
are faster, cheaper and will help you
get the best result with less time
and less money.”
The panel added that firms
looking to work with technology
vendors on certain aspects of their
execution processes should seek a
company that will act as a partner.
But the outsourcing question ulti-
choosing which technology vendor
to work with, with O’Brien adding
that often vendors can “promise the
world”.
“I’m not suggesting they are mis-
leading us, but they may not com-
pletely understand our challenges,”
he said. “That initial conversation
ahead of partnering and moving
forward is crucial because it’s about
building the trust. We can talk to
references and they’ll have a reputa-
tion in the marketplace, but there’s
really no way of knowing if they can
solve my problem. It’s an ongo-
ing process for both sides, but it’s
important that you choose carefully
and take your time.”
Issue 59 // TheTradeNews.com // 29