Our focus at Digital Vega is to provide pragmatic and cost effective technology to automate routine business tasks and provide real solutions that solve real business problems.
Our tools are designed to provide standard out-of-the-box solutions yet offer easy customisation to meet client specific requirements.
We support industry standards where they exist and help define best practices where they do not.
We continue to work with our clients and other industry participants to evolve new standards which we freely share with everyone.
At Digital Vega we realise that every client has different business priorities and requirements. However, all of them share the common goal of reducing cost and eliminating errors through use of technology and automation.
We have worked closely with a number of clients to develop a series of pre and post trade workflow automation tools. These tools can be configured and tailored to meet the specific requirements each client. Whether that means routing orders to a specific execution trader or desk, applying order netting rules for a portfolio manager, or whether it means notifying different prime brokers of specific executed trades, our tools can help.
FX Connect is widely recognised as a market leader of STP services to the Asset Management community. Their success is largely based on the comprehensive solutions they provide to manage the ‘allocations’ process.
We have worked closely with FX Connect and several of their major clients to design the Digital Vega Allocations services. We are able to do for FX Options what FX Connect have done for cash FX.
Through our intuitive Allocations GUI and comprehensive set of APIs, Buy Side clients can manage the end-to-end allocations process for FX Options.
The Digital Vega Allocations services are available for trades executed over the phone, over other ECNs or on our own Medusa trading platform.
This means that the large block trade executed over the phone directly with your bank or over that bank’s single dealer platform can now be ‘allocated’ over Digital Vega. The details of the ‘trade splits’ will be notified to all relevant parties including the bank, one or more prime brokers, custodians, clearing agents as well as and your in-house systems.
Off-platform block trades can be input into the Digital Vega platform manually through a GUI, automatically via a FIX-based API or loaded from a spreadsheet.
The splitting or ‘allocation’ of trades across a range of accounts or funds can be automated through the use of templates or managed dynamically. Resultant allocations can be notified to other counterparties via spreadsheets or through a FIX-based API.
Though electronic trading of OTC FX options is still in its infancy it is starting to follow a similar path to that of the cash FX market place. Our close working relationship with Currenex has afforded us the opportunity to learn from the undisputed masters of white label FX solutions.
The Digital Vega platform can be re-branded in just a few days so that brokers, agency traders and banks can provide their clients the ability to trade FX Options. White label partners can offer their clients both a direct relationship trading model as well as a prime brokered or prime of prime model. In addition white label partners can set a comprehensive range of trading limits at both the entity and sub-account/fund levels.
The platform is hosted in our data centres, so there is minimal cost outlay to get up and running.
Clients can chose which currency pairs they wish to support in-house. Other currencies can be outsourced to external liquidity providers supporting the Digital Vega platform with auto-generation of back-to-back trades.
Full STP of trades is available into the clients systems.
Single Dealer Platforms
Whilst many major FX banks have invested in developing their own single dealer platforms to support FX options trading not all FX participants can justify the high cost of entry.
From the outset the Digital Vega platform was designed to support a single-bank mode of operations. As well as the ability to be rebranded and integrated in to a bank’s broader eCommerce offering.
A bank can integrate a single-dealer version of the Digital Vega platform with say their cash FX services either at the web page level or through a custom GUI embedded in their portal via our FIX-based trading API..
Our Single Sign-on API allows users that have been authenticated on the bank’s eCommerce system to be automatically authenticated on the FX options platform. Its a seamless user experience throughout.
As with all of our solutions, full Trade STP is a standard feature.
The SDP version of Medusa is hosted in our data centres so there is minimal cost outlay for SDP partners.
Whether you are a broker acting as an agent trying to fill client orders at the lowest price and in the fastest possible way, executing large block orders from for an institutional fund or even a bank transitioning your FX business to an agency model we have designed the Digital Vega platform to support your business.
Our portfolio of rebranding, currency support, trading limit services and integration APIs allow us to tailor a solution that meets your business model in a matter of days.
Your client identity is kept confidential through encrypted and secure obfuscation techniques so we will not know who the end client is. Liquidity can be retained in-house for designated currencies or outsourced to other Digital Vega liquidity providers.
We work with our agency trading partners to implement custom spread management or fee based models to suit their style of business.
The platform is hosted in our data centres so there is minimal cost outlay to get up and running.
Digital Vega CONNECT
In building the Digital Vega platform we designed everything around a service-oriented architecture. Each service being a standalone module. Just about every service can be accessed via a GUI as well as an API.
In working with our partner banks to integrate them to our platform we gradually realised that many of our services could be packaged to provide tools that would help them to manage volatility surfaces, auto price FX options, perform credit checks, route pricing request to dealer intervention, manage spreads etc.
We have now packaged many of our core services as a family of products we call Digital Vega CONNECT. These services can be used individually or in any combination to enable banks to cost effectively become a participant in the trading of online FX options.
Digital Vega CONNECT comprises the following products:
- Auto Quote CONNECT
- Price CONNECT
- Vol CONNECT
- FX Rate CONNECT
- Credit CONNECT
- Trade CONECT
- ECN CONNECT
Most of these services can be populated by Digital Vega data and models or alternatively set up to use bank proprietary data and models.
All Digital Vega CONNECT services are provided on a hosted basis to minimise initial and ongoing costs.
Auto Quote CONNECT
The Auto Quote CONNECT Server is responsible for implementing client specific auto-quoting and dealer intervention routing rules.
The service can be configured to trigger an ‘auto-quote’ price response based on currency pair, tenor, amount or even client. Everything else would be routed for and dealer intervention and manual pricing. Similarly, unsupported currency pairs or products could be automatically declined.
This service can be implemented using Digital Vega’s industry standard Black ’76 pricing models. Alternatively, bank proprietary pricing models can be integrated using our Options Pricing API.
The Price CONNECT server is responsible for calculating the price of an option. It can be set up to use Digital Vega’s industry standard Black ’76 pricing models or access proprietary bank pricing models integrated via our API.
The Price CONNECT server can use Implied Vols and FX Rates provided by Digital Vega or alternatively banks’ own Implied Vols and FX Rates data can be interfaced through the corresponding APIs.
The Vol CONNECT server is an Implied Volatility Data Manager supporting data for the required number of currency pairs with a ‘spine and rib’ structure from overnight to 1 year in daily increments and a granular range of delta points from per tenor. Any missing points are interpolated whenever an adjacent point on the surface is updated.
The Vol CONNECT server can be populated with aggregated data from Digital Vega, data from brokers or the banks own internal source.
Real-time implied volatility data is fed into the Auto Quote CONNECT server.
FX Rate CONNECT
FX Rates can be sourced from both Digital Vega aggregated data via Currenex or alternatively populated from the banks’ own rate feeds.
The Digital Vega Credit CONNECT service preforms a range of real-time credit checking and credit utilisation services.
USD NOP/Delta Credit limits can be assigned to each client/account/fund/ prime broker hierarchy that will manage the banks exposure to any given client.
Credit CONNECT services are powered by the Traiana Margin Center product.
Alternatively banks can connect to their internal credit systems using the Digital Vega Credit CONNECT API.
The Digital Vega Trade CONNECT API provides access to real-time and historic trades that the client has executed on the platform. Standard ‘adapters’ have been produced by integration partners for commonly used treasury and risk management systems.
Please contact us for more information on supported platforms and contact details of our integration partners.
The Digital Vega ECN CONNECT APIs are a series of adapters produced by integration partners that provide out-of-the-box connectivity to both Digital Vega and other FX Options ECNs.
Please contact us for more information on supported platforms and contact details of our integration partners.
The Digital Vega platform provides a comprehensive set of features to support Prime Brokers and their clients’ use of the platform.
Maximum trade size – The Digital Vega platform allows the Prime Brokers to specify a maximum notional trade size for client trades.
Minimum tenor – The Digital Vega platform allows the Prime Brokers to specify a minimum tenor for all trades. This is optional and the minimum default is ‘Overnight’.
Maximum tenor – The default maximum tenor is 1 year. Prime brokers may select a shorter maximum tenor.
Maximum NOP/Delta Limit – The Digital Vega platform allows the Prime Brokers to specify a maximum net open position/delta limit in USD for:
- The client overall
- The client against each Executing Broker
Limit Utilisation Thresholds – The Prime Broker can set limit-utilisation thresholds each expressed as a percentage of the overall limit. As thresholds are breached the Prime Broker and Digital Vega are alerted by the platform as well as by email. The Medusa platform can be set to block any further trading when a threshold has been breached.
Traiana Harmony ‘Give-up’ Notifications – Digital Vega is fully integrated with the Traiana Harmony Network. The Prime Broker can chose to have Digital Vega sent them notifications via Harmony or alternatively, to only receive notifications from the Executing Broker. This is an optional service provided by Digital Vega.
Email Trade Notification – The Prime Broker can receive email notification of client trades as they are executed. This is an optional Digital Vega service provided for Prime Brokers.
End-of-Day Activity Report – The Prime Broker can receive email notification of client trades at the close of business New York time. This is an optional Digital Vega service provided for Prime Brokers.
‘Kill’ switch – The Prime Broker can stop all trading for a specific client by hitting the ‘Kill’ switch and disabling the client against all Executing Brokers.
Whether your requirement is to back test models or feed live Implied Volatilities to your pricing engines Digital Vega probably has the data you need.
You can access both historical and live streams of aggregated volatility data from Digital Vega. We can provide the data in a variety of forms including a FIX-based feed, XLS or text files.
We will also soon be adding spot and standard tenor point forward rates to supplement our vol data.
For further information please contact us directly.