Exclusive interview FNG… Tom Higgins, CEO of Gold-I, talks to FNG about the need to have multiple sources of liquidity and provides guidance on what to look for on a liquidity management platform.
Fng: Hi Tom. What is the advantage of having multiple liquidity providers?
Someone: There are many advantages. First, the ability to centralize at the best price is a significant benefit. You will have better execution prices if you have multiple liquidity providers because they compete effectively with each other for your business.
Second, you have a failure if one of your liquidity providers has an issue (and all LPs have a vacation at some point). Confidence in a single liquidity provider could leave you without any pricing if the liquidity provider is down for any reason.
Thirdly, with multiple liquidity providers deepen your order book. If a customer negotiates large volumes, you can choose to fill everything at the top of the book to three liquidity providers instead of getting down to the book at a single source.
In summary, possession of multiple liquidity providers gives you access to better prices and increased reliability. It also puts you in a strong position to negotiate with liquidity providers if you can show that you are getting better prices elsewhere.
Fng: How is the Gold-i i Matrixnet designed to accommodate aggregation?
Someone: Matrixnet is a multi -asset liquidity management platform, with many automated features, powerful controls and the ability to manage liquidity in great detail. It offers brokers a variety of routing and agglomeration methods and the ability to adapt execution models that fit the unique preferences of different types of customers.
For example, most customers choose for an order to automatically divide into various components and distribute around multiple liquidity providers to receive the best VWAP value (average volume value). However, they have the choice for the entire order to be executed in one place through a single liquidity provider with the most competitive VWAP price.
We have placed a series of configurable controls to provide protection. Also, if a liquidity provider shows the best price, but it can’t really fill you – maybe because they have technical issues – then you will automatically transfer to another liquidity provider in your centralized book.
The brokers to get a complete report of what is happening and why, without having to constantly have manual checks.
Fng: How is Matrixnet different from other liquidity management platforms?
Someone: Everything ends in characteristics. The innovative features and capabilities with which we work include smart repetition logic, synthetic instruments, transaction control API, point -based speedbumps and API WebSocket. We have invested a lot of time to promote our redefinition mechanisms, including the ability to rule out the liquidity providers that have already rejected you.
Another feature we have introduced is what we call a “sin” system, where we a yellow card card provider if they reject orders. For the next time (or time period of the user’s choice) we do not launch orders. As soon as they reappear, if they reject again, they are red and are permanently removed. This is highlighted in the broker and the risk administrator can evaluate the situation and decide whether or when to add them again.
Fng: What are the most important factors to look for when choosing a liquidity management platform?
Someone: The obvious questions you need to ask are what categories of assets and institutions are covered, speed of price updates, trade times, cost and commercial structure (ie a specified monthly price or lower monthly fee and transaction fees) and if the recovery of disaster is incorporated.
When choosing a liquidity management platform, people often do not know specific features to request this can make a huge difference in saving time and money or providing additional protection. Features such as Speedbumps and Remtry Logic are really must have features.
It is worth noting that speed is truly decisive and can vary significantly between different platforms. Due to the large number of price updates per second in the encryption area, we have ensured that Matrixnet can face 50,000 price updates per second.
Fng: How do brokers choose which LPS should be in their centralized book?
Someone: We are often asked. We have a lot of experience in working with many liquidity providers, so if we have a clear understanding of a broker’s commercial strategy, we can recommend liquidity providers that are a good race – that is, with the right leverage, the right instruments, the size of the tickets, etc.
Matrixnet has more than 80 pre-exalted liquidity providers and 35 encryption exchanges. If customers come to us and want to add a liquidity provider that we do not have today, we are always pleased to make a completion – and we do not charge to incorporate a new liquidity provider.
Fng: How key is Matrixnet in the Gold-i product portfolio?
Someone: Matrixnet is our flagship product and is at the heart of our products. Our other products are designed to add perfectly to Matrixnet and create a complete solution for brokers, funds and institutions. Sales have increased significantly over the last two years and we continue to invest in it and add new features. Extensive plugins metatrader and risk management tools remain significant for us and are essential to help brokers work effectively, minimize risk and maximize profit.