JP Morgan’s new way to trade FX overlays

JP
Morgan
is
setting
out
to
potentially
disrupt
its
own
foreign
exchange
overlay
business
with
a
new
execution
method
that
allows
clients
to
place
multiple
dealers
in
competition
for
trades,
while
using
the
bank’s
credit
standing
to
secure
the
best
price.

Currency
overlays
are
typically
executed
on either
a
principal
or
agency
basis.
Providers
that
use
a
principal
model
send
all
trades
to
their
own
FX
desks,
while
agency
trades
are
put
out
for
competition
on
multi-dealer
platforms
(MDPs).

JP