This interview was published to e-Forex magazine, July 2017
PrimeXM is a leading technology provider to the global financial industry. The company was established in 2010 and its key business focus is providing cutting edge aggregation software, ultra-low-latency connectivity, institutional grade hosting solutions and high end MT4/MT5 Bridging and White Labels. e-Forex talks with Cristian Vlasceanu, CEO of PrimeXM about how it is building its business in Asia.
What services do you provide to Asian markets?
PrimeXM is active on a global basis offering our full suite of technology, hosting and connectivity services. We have a full institutional grade infrastructure in London, Equinix LD4, New York (NY4) and Tokyo (TY3). The latter being the optimum location for the APAC region. Our primary product is an ultra-low-latency aggregation, smart order routing and reporting engine which we call XCore, available in any of our datacentre locations.
With dedicated access to their own XCore system any client is free to leverage our extensive infrastructure with co-located connectivity to over 120 liquidity sources, from Tier 1 banks, major non-banks ECN’s, brokers etc.
Additionally, each client’s XCore engine is fully hosted by us within the chosen datacentre location which is a wholly owned and managed environment by PrimeXM. This highly advanced setup allows us to offer our clients access to the fastest and most stable connectivity solution to the global liquidity market at sub-milli-second speeds. So, any entity based in Asia or servicing the Asian markets from elsewhere is able to have a local presence in Tokyo from PrimeXM and therefore offer the fastest execution to the region, rather than routing trades back to London or New York.
In addition to our primary product XCore, we offer enterprise level hosting services which enables clients to house their trading systems and/or algos in co-location to their execution engine and LPs in Tokyo, ensuring the most optimal trading experience for them and/or their end clients.
Moreover, we have our own dedicated low latency fibre lines linking all of our datacentres together, so for clients that have a primary setup outside of Asia we can route traffic from London or New York directly to Tokyo which slashes latency and guarantees consistent execution even during periods of high market volatility.
We have also established an exclusive direct fibre line from mainland China to London (LD4), which enables our clients servicing the Chinese trading community to by-pass the great firewall and offer the finest trading experience to their clients located in the mainland.
What is behind the demand for FX among Asia’s retail traders and brokers?
The foreign exchange and CFD market has never been in such high demand across the APAC region. It is driven by the huge potential opportunities that exist for investors in the OTC market in general, the significant appetite many Asian’s have for speculating and the fact many countries from the region are experiencing substantial financial growth which means there is more disposable income available to be invested. We are experiencing exponential demand for our services in this region to facilitate setups for existing local brokerages and institutions, new brokerages and to assist existing brands from outside the region that are looking to extend their reach into Asia and take advantage of the exciting and prosperous opportunity that exists there.
What are the challenges of connecting to FX trading venues based in Asia?
Typically, the majority of liquidity providers and banks are streaming prices from London and New York, so execution speeds is one challenge for Asian based trading venues. However, we are seeing Tokyo TY3 becoming ever more popular of late which has resulted in the key LPs tightening their pricing from this location and more of the non-banks and other LPs establishing presences there. We foresaw Tokyo as being the natural next major location for co-located liquidity and connectivity services for the whole of Asia, and therefore built our own dedicated framework in Tokyo TY3 two years ago, to be ready with an established and comprehensive offering.
Now we facilitate many setups for brokerages, institutions and LPs with a local setup in TY3 and capability to offer fast execution speeds across Asia. Tokyo is the de-facto location for any firm wishing to offer the best in class service to their clients and counter-parties in Asia.
What makes China so different to the rest of Asia and how do you deal with the Great Firewall?
We have an established office in Shanghai, China, whereby we are servicing many existing brokers and institutional firms. China’s internet infrastructure presents a number of unique challenges that can adversely affect a high-quality trading experience and negatively impact broker’s reputation. Due to restrictions introduced by the great firewall and congested international bandwidth, communication to and from servers outside of China results in a low-quality trading experience. PrimeXM’s China Connectivity solution addresses these challenges. With a direct low latency leased line from Shanghai (SH5) to London (LD4) and with servers deployed within mainland China, firewall and international bandwidth bottlenecks are avoided giving a significant competitive advantage to PrimeXM clients.