Risk Management
Published 5 MIN READ

Creating Simplicity and Transparency in Global FX Markets

by Lee Butler, Global Head of FX eDistribution, HSBC

Technology is having a radical impact on the way that people and organisations communicate, do business, and access and share information. While this is most apparent in our role as consumers, we are increasingly demanding the same degree of convenience and real-time access in our working lives. Banks and technology vendors have not been slow to respond to these changing client demands, with the rise of digital solutions that help make everyday treasury tasks quicker, easier, more efficient and secure. This is the background to HSBC evolve, HSBC’s new generation, global FX execution and exposure management platform, which is designed to ultimately become a core element of clients’ treasury technology framework.

The corporate challenge

One of the biggest challenges facing corporate treasurers is that managing FX risk is only one element of their role and as such, they need to balance the time and resource required to manage FX alongside other key responsibilities such as cash management and funding. At the same time, 2017 is unlikely to be a quiet year in the FX markets with uncertainties arising from the new US presidency, the start of the Brexit process and elections in countries such as France and Germany, to name but a few. Regulatory change is also likely to have an impact on the way that treasurers manage their FX exposures as they prepare for MiFID2, which comes into effect in January 2018.

Introducing HSBC evolve

In this environment, treasurers are seeking one-stop-shop solutions that offer a robust, secure approach to managing FX risk with ease of execution, price transparency and global consistency. Ultimately, the aim is to have more time and capacity to focus on more analytical and strategic tasks across the diverse spectrum of their responsibilities. This is the background behind HSBC evolve, our innovative single dealer platform, available 24/5. HSBC evolve is simple and intuitive, and designed to offer clients greater transparency and control over their FX exposures. Most importantly, it offers the ability to trade in our covered currencies in a reliable and secured manner when needed. For example, HSBC evolve currently supports over 460 currency pairs, both deliverable and non-deliverable, across Asian, European and North and Latin American markets, with seamless access to the bank’s liquidity network. In addition to pre-trade and execution capabilities, including spot, forward and non-deliverable forwards, HSBC evolve offers a post trade suite which allows the client to confirm more complex products such as FX options electronically and simplify FX confirmation, with a suite of electronic post-trade services (box 1 - see page 2).

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