FairXchange introduces pricing stack analysis feature

Financial markets data science firm FairXchange launched a new Pricing Stack Analysis feature which enables financial institutions around the world to make more informed, data driven decisions about how they interact with existing and prospective Liquidity Providers.

FairXchange provides a full view of a financial institution’s pricing stack through the new feature. The Pricing Stack Analysis offers insight into the dynamics of their liquidity and enables banks, brokers and hedge funds to understand the financial impact of their Liquidity Provider selection compared to other options.

Pricing Stack Analysis uses FairXchange’s proprietary technology to answer a few specific, yet important questions including:

  • What targeted feedback can we give to our Liquidity Providers to increase their revenues whilst simultaneously reducing our costs?
  • How much would removing or adding a Liquidity Provider change my bottom line execution costs?
  • Which LPs show me the best spreads and skews?
  • If I were to choose 5 Liquidity Providers from a possible group of 10, which 5 should they be?
FairXchange launches Pricing Stack Analysis feature

Guy Hopkins, Founder and CEO, FairXchange commented:

Guy Hopkins, FairXchange

Guy Hopkins

A fundamental issue that the market currently faces is that financial institutions find it very hard to measure the financial impact of any changes to their liquidity provision. Conversely, Liquidity Providers find it hard to demonstrate the value they can bring to a client, how much more money they can save them or how they can win more clients through data-driven discussions. We have developed our Pricing Stack Analysis to address these issues, providing concrete evidence about the impact of liquidity decisions on a financial institution’s P&L.

Hopkins continued:

With margins so tight in FX, firms will increasingly need to rely on data-driven decision making in order to make greater profits. FairXchange has a proven track record in applying our domain expertise to help customers craft a narrative from their data. Pricing Stack Analysis propels our offering to another level as we can now crystallise the results from our analysis in monetary terms – i.e. measuring cost savings in real dollars. This makes it far easier to justify the subsequent cost of onboarding a new Liquidity Provider, for example. Helping them identify tangible evidence of the potential savings they can make is a core part of our value proposition.

FairXchange was established in 2016 and it specialises in microstructural analysis of financial markets. The firm brings transparency to execution performance by providing independent data. Its analytical product Horizon is designed to facilitate constructive, data-driven dialogue between counterparties, helping them to identify mutually profitable opportunities.

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