Tom Osborn reports on the growing trend of exchanges that are looking to launch FX futures franchise, and looks at where the European currency market landscape is heading.
CME group is leading the wave of exchanges moving into the FX futures franchise, many of which argue that FX futures will come into their own when capital charges go up for OTC FX derivatives.
Frederic Ponzo, GreySpark, explains why this sudden interest in FX futures has come about, pointing out that the regulatory landscape favours the exchanges as one of the main drivers. He goes on to describe how the regulatory changes will force many FX derivatives that are currently traded OTC on to competitive electronic platforms, making them favourable products to trade on the FX futures market.
The article goes on to evaluate the competitive landscape and growing appetite for risk in the FX markets.