Union Investment has executed its first block foreign exchange (FX) futures trade through Deutsche Börse Group’s FX trading platform 360T and is also set to implement the 360T EMS.
The trade – requested and priced through 360T – was processed directly into Eurex for clearing.
Christoph Hock, head of multi-asset trading at Union Investment, told The TRADE that the business had been preparing for this development for around six months, not only focused on the transaction itself during that time, but also setting up the internal processes for the implementation of 360T which took a couple of months.
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Speaking to the decision to trade through 360T, Rico Milde, head of FX trading at Union Investment, said: “Given that we are a long-term user of Eurex FX futures and have many trading relationships to manage, 360T – which offers us a range of specialist execution management capabilities – was a natural choice to partner with.
“We are confident that using the 360T EMS to manage all of our off-exchange futures relationship-trading activity in a fully integrated setup will deliver significant benefits to our trading desk.”
Deutsche Bank was the inaugural foreign exchange futures liquidity provider for Union Investment, with the bank set to reap the benefits of central clearing as well as continuing to take advantage of the customisation of over-the-counter (OTC) FX execution models, according to Hilko Kalberlah, head of DACH FX sales for institutional clients at Deutsche Bank.
360T provides web-based trading technology for OTC instruments, as well as integration solutions and related services.
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Speaking in an announcement, 360T explained that the potentially increasing costs when it comes to trading FX forwards across OTC channels, as a result of regulatory changes, will likely make its offering more and more attractive to market participants.
Sebastian Hofmann-Werther, head of EMEA at 360T, highlighted how this move fits into the business’ strategy: “The seamless integration between 360T and Eurex is part of a strategic investment we have made into supporting Listed FX trading alongside our world class OTC offering and we are now able to provide access to a range of different FX futures products to meet the various needs of our diverse, global client base.
“Meanwhile, we continue to see strong adoption of our best-in-class EMS by market-leading firms like Union Investment as they look for ways to continue expanding and enhancing their FX execution capabilities.”
Earlier this month, 360T made streaming mid liquidity via APIs available on its Swaps User Network (SUN), with Deutsche Bank and ING executing the initial trade. According to the business, this was the first time two banks had been able to trade FX swaps via API and match at the market midpoint.
Speaking to The TRADE, Hock said: “When we’re looking at futures transactions we have a higher participation rate compared to most of our peers […] so we’ve been fairly early adopter of this product.
“What’s important for us when executing – not just in FX but all asset classes – is to get the very best outcome for our investors. Not just best execution, also the regulatory requirements. Our goal is to be connected to the very best platforms and have the best breadth of broker firms on this platform, enabling us to play the white keys, the black keys and the pedals of the piano.”