, the UK and Cysec regulated global broker, is acquiring Quotix, a company which technology helps forex brokers to gain access to better liquidity, prices and execution.
FXPro is no doubt one of the most dynamically growing forex brokers worldwide. With the increasing trading volume the company enjoys also comes a challenge – to ensure enough liquidity. Even a slight liquidity shortage, one lasting milliseconds, can lead to slow execution, wide spreads, and slippage.
To address such potential risks FXPro decided to buy Quotix
. The latter company, founded in 2010 and headquartered in Cyprus, is offering a spot forex aggregator. Simply put, Quotix’s aggregator works as a price feed and bridge linking a broker to multiple liquidity providers. The broker hence can compare prices and choose the best as well as benefit from the huge liquidity pool Quotix represents.
The results of using Quotix’s technology should be tighter spreads, faster execution and little to no slippage at all even when bigger volumes are traded as, for instance, in case of high market volatility. These are the reasons FXPro cites as rationale to buy the fx spot aggregator for an undisclosed fee alongside with the notion that FXPro intends to explore the institutional retail forex market.
There is an interesting sentence on Quotix website comparing its spot fx aggregator with an Electronic Communication Network (ECN
): “Similar advantages may be achieved by trading on ECNs. The key difference of aggregators is that the liquidity is relationship-based which may be substantially cheaper for clients who make large volume. Delivering liquidity on a disclosed basis can be beneficial for both for the liquidity taker and the liquidity provider. The takers can receive deeper liquidity and more consistent pricing whereas the liquidity providers can tailor pricing based on their relationships with clients.”
Sounds good. If the execution is perfect in terms of speed, spread, price, and no slippage is detected every trader will be happy and questions about visibility would not be posed. Still the lack of transparency can be regarded as weakness compared to the biggest ECNs or LMAX Exchange
Anyway, the acquisition of Quotix is a big step forward for FXPro as explained by Mr Charalambos Psimolophitis, CEO of the company:
“As we continue to grow exponentially across the globe, liquidity is critical to ensuring we can provide the best spot FX prices for our clients. This new acquisition allows FxPro to diversify and opens more doors as we start to offer prime-of-prime, aggregation and liquidity services. Above all it will mean improved pricing for clients. We currently have twelve liquidity providers and are aiming to increase this number. By acquiring Quotix we will also be in a stronger position to work more closely with our existing liquidity providers and bring on new ones."