UK: Investment association demands transparency on FX Trades

The British Investment Association is calling on banks and brokers to provide greater transparency, with regards to the reasons for pulling out of a foreing exchange (FX)trade at the last moment.

As it currently stands, fund managers are left to wonder what is causing some of the last-minute trade cancellations, as banks are not providing any information when such occurrences take place.

The new guidelines that were published on February 22, require banks and brokers to specify the reasons for canceling a position, when the pullout takes place at the last moment. They must adhere to the guidelines and provide a reason from a pre-set list of causes, including speed, price improvement, internal credit checks, and price tolerances.

The scope of the FX trading market in London averages a daily turnover of over US$2 trillion. The sheer size of the market makes it critical that all activities are monitored to prevent any potential misconduct by market participants.

Full Content: Kitco

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