Financial markets data science firm, FairXchange has launched ‘game changing’ functionality within its Horizon product with a new Pricing Stack Analysis feature which enables financial institutions worldwide to make more informed, data driven decisions about how they interact with existing and prospective Liquidity Providers.


By providing a complete view of a financial institution’s pricing stack, FairXchange’s Pricing Stack Analysis provides unparalleled insight into the dynamics of their liquidity and enables banks, brokers and hedge funds to understand the financial impact of their Liquidity Provider selection compared to other choices they could make.


Pricing Stack Analysis uses FairXchange’s sophisticated proprietary technology to start addressing specific insightful yet previously unanswerable questions such as:


  • What targeted feedback can we give to our Liquidity Providers to increase their revenues whilst simultaneously reducing our costs?
  • How much would removing or adding a Liquidity Provider change my bottom line execution costs?
  • Which LPs show me the best spreads and skews?
  • If I were to choose 5 Liquidity Providers from a possible group of 10, which 5 should they be?


Guy Hopkins, Founder and CEO, FairXchange comments, “A fundamental issue that the market currently faces is that financial institutions find it very hard to measure the financial impact of any changes to their liquidity provision. Conversely, Liquidity Providers find it hard to demonstrate the value they can bring to a client, how much more money they can save them or how they can win more clients through data-driven discussions. We have developed our Pricing Stack Analysis to address these issues, providing concrete evidence about the impact of liquidity decisions on a financial institution’s P&L.


“With margins so tight in FX, firms will increasingly need to rely on data-driven decision making in order to make greater profits. FairXchange has a proven track record in applying our domain expertise to help customers craft a narrative from their data. Pricing Stack Analysis propels our offering to another level as we can now crystallise the results from our analysis in monetary terms – i.e. measuring cost savings in real dollars. This makes it far easier to justify the subsequent cost of onboarding a new Liquidity Provider, for example. Helping them identify tangible evidence of the potential savings they can make is a core part of our value proposition.”


FairXchange specialises in microstructural analysis of financial markets. It was founded in 2016 to bring clarity and transparency to execution performance through the provision of independent data. Its state-of-the-art analytical product, Horizon is designed to facilitate constructive, data-driven dialogue between counterparties, helping them to identify mutually profitable opportunities. FairXchange is completely independent and has no affiliation with any Liquidity Providers or trading venues.