Institutional FX Uncensored: Recent Episodes

Institutional FX

While FX Market is the largest and the most liquid market in the world, it is also one of the least transparent. What are some of those well kept industry secrets? How can you access the market in a way that suits your strategy and investment objectives? How to find institutional providers and FX prime brokers? What are industry’s biggest challenges? Our expert team with combined FX industry experience of over 200 years, will look under the hood and attempt to answer many of these and other questions via series of podcasts where we will be discussing all things institutional FX, fintech and evolution of electronic currency trading. Tune in to listen to prominent guests and keep up with latest institutional FX trends and news.

Episode description:

Natallia Hunik and Andrew Gillibrand dive deep into the world of micro investing, gamification of trading and the power of retail investors. What does the future bring for retail investors as technological advancements untap more new investment opportunities?

Guest:
Andrew Gillibrand: CEO and Founder of Union, a Distribution Ecosystem for Alternative Investments. Formerly a manager, with a strong focus on the contrarian, Andrew is now a pioneer in the world of alternative investments, driving his vision for an industry ripe for disruption.

Highlights for discussion:

Andrew has spent the last part career in alternative asset management. How did he get an idea about starting Union? What prompted that? What inefficiencies he has noticed in the industry that prompted him to start his own company? And what is a micro fund?
Andrew’s technology is focusing on fund distribution. During FX Hedge Fund Expo 2020, Advanced Markets, the event organizer, has surveyed the participants about their biggest challenges when trying to raise funds and #1 cited reason was lack of personal network. How can Andrew’s platform help with that?
The asset management industry has undergone many shifts within the last few decades, from the rise of hedge funds to ETFs and tracking funds. But lately there has been massive disruption coming from the bottom – from retail users that can move the markets using crowd power, trade fractional shares and follow other successful leaders. Micro investing has taken market by the storm: real estate syndicates, fractional shares, works of art, wine, cars and much more. How are Micro Funds different and why would an investor consider their inclusion in a portfolio?
Fragmentation and volatility (or what used to be volatility ) make FX less attractive as an investment class than other asset classes. Does Andrew’s platform attempt to solve this problem?
What are the major challenges that FX fund managers face when trying to scale their strategies?

Episode description:
Natallia Hunik discusses challenges of fundraising for a hedge fund with Ronald Richter, co founder and managing partner of Bride Valley Partners, boutique advisory firm that provides best-in-class corporate finance, investment advisory and capital raising. Prior to Bride Valley Partners, Ronald held various roles in the alternative investments industry for the last twenty years.

Guest:
Ronald is the co-founder and managing partner of Bride Valley Partners and has held, for the last twenty years, various roles in the alternative investments industry.

Highlights for discussion:

Ronald shares his background and the behind-scene story on how he found Bridge Valley Partners; Ronald also shares his ample experience in capital raising.
Fundraising is one of the biggest challenges to launch the fund. HF managers cited lack of personal network as the major worry when launching their own fund. How important is the personal network? Ronald shares his opinion on what are the most effective ways to raise capital, and how critical is it to have the personal network when launching a fund.
Historically, marketing has been a challenge for the hedge funds as its only supposed to be catered for accredited, sophisticated investors. Most US hedge funds have their pages password protected. What does it look like in Europe under AIF directive? Ronald shares his opinion and observation on it.
The capital introductions teams at prime brokers routinely highlight their industry connections and ability to facilitate meetings between capital-hungry hedge fund managers and yield-hungry investors. But the situation is less clear-cut for smaller to mid-sized hedge fund managers, many of whom will struggle to even get on-boarded by a prime broker in the first place. What relationships can startup managers leverage to get capital introductions?
What are the top 3 mistakes hedge fund managers make when preparing their pitchbooks?
Recent report from PWC on Crypto hedge funds indicates that the total assets under management (AuM) of crypto hedge funds globally increased to nearly US$3.8 billion in 2020 from US$2 billion the previous year. Is there a growing interest from the institutional investors for crypto investing? Ronald shares his thoughts on this and the potential crypto hedge funds’ future overall.

Natallia Hunik and Praveen Kumar dive into the hot topic of evolving crypto regulations and what the firms should be doing to stay within the lanes as global crypto regulations are evolving.
They discuss various jurisdictions for setting up crypto business and its pros and cons.

Guest:
Praveen is the founder and CEO of Belfrics Group. He has over 15 years of experience in financial markets with specific expertise in OTC and exchange-traded derivatives. He has served multiple financial institutions in India, the Middle East and Far east and has provided liquidity solutions to various exchanges.

Highlights for discussion:

Praveen shares some details of the recent transaction in which his Crypto Exchange company Belfrics has been acquired by a US publicly listed company, and the multiples people could expect in the crypto business; (About the transaction: https://www.globenewswire.com/news-release/2021/08/26/2287147/0/en/Life-Clips-Closes-Belfrics-Group-Acquisition.html)
Recent report from PWC on Crypto hedge funds indicates that the total assets under management (AuM) of crypto hedge funds globally increased to nearly US$3.8 billion in 2020 from US$2 billion the previous year. That constitutes 0.095% of the total AUM managed by the hedge funds. Around a fifth of hedge funds are investing in digital assets (21%); the average percentage of their total hedge fund AuM invested in digital assets is 3%. More than 85% of those hedge funds intend to deploy more capital into the asset class by the end of 2021.
Given this huge potential to grow, Praveen was asked about his thoughts on potential crypto hedge funds’ future and shared his opinions.
As an industry pioneer starting in FX and ventured out to crypto early on, Praveen is followed by a lot of talent from the FX industry who comes after his footsteps and moved on to crypto projects. Many are setting up their own crypto funds. According to the same PWC report, Cayman Islands, US, Gibraltar, BV and Lux are the most popular jurisdictions for FX funds. Which jurisdictions give one the biggest bang for the buck? Praveen shares his insights on this important question
What are the top 3 things for the new crypto fund managers to consider when starting their own crypto fund? Praveen shares his opinion.
Banking is challenging for FX firms, how is it for crypto? How hard is it to acquire banking relationships for crypto firms and what do they need to keep in mind? Praveen talks about this in-depth.
Is BTC still the major traded crypto currency for the hedge funds?

Natallia Hunik discusses challenges of fundraising for a hedge fund with Laurence Yang, overachiever and successful hedge fund manager from Australia.
90% of hedge funds don’t raise more than $100m ever. So how to overcome and scale beyond that? What is the reason for this AUM plateau? This and more are covered in this episode.

Guest:
Mr. Laurence Yang, an Australian resident, founded Laurence Holdings Group Limited in 2017 as a private investment holding company to manage investments for himself and Ultra-High-Net-Worth-Individual partners' Single-Family Offices.
Laurence has started his first fund in 2014, and in less than 2 years, by the end of 2015, Mr. Yang had generated over 50% return for his investors. Mr. Yang was able to start Laurence Holdings later with this successful track record.

In 2017, Mr. Yang formed Laurence Holdings Group Limited to serve as the corporate investment vehicle for its early investors. The company started the flagship Euro-Denominated Fund with a Net Asset Value (NAV) of €15.5 million in November 2017, by the end of May 2021, the fund has a total NAV of over €49 million.

Natallia Hunik discusses running an FX brokerages in Europe with Ricardo Evangelista, CEO of ActivTrades Europe. How do European brokers market to regions given regulatory restrictions, how do they navigate the ever changing regulatory landscape and how are European clients differ from the rest of the world. This and much more about running an FX brokerage in Europe in this episode with Ricardo.

Guest:
Ricardo Evangelista, CEO of Active Trades Europe, part of Active Trades Group, is one of the most reputable brokers in the industry. The group holds multiple financial licenses in Europe ( UK and Luxembourg) and abroad.

Episode description:

Natallia Hunik discusses with James Cameron, Chief Risk Officer at iSignthis, independent card acquirer and e-money institution, publicly listed in the Australian and Frankfurt Stock Exchange (ASX: ISX | FRA: TA8) since 2015, the reasons behind the FX industry struggles with getting banking and payment channels. Besides, James discusses the rationale behind considering the FX business as an ultra high risk by banking institutions, and what can FX businesses do about it.

Highlights for discussion:

James shares with the audience his background and success story. Reasons behind the launch of iSignthis and the businesses it serves
The top three reasons making it so hard to find banking for FX brokerages
As a result of high demand, the market forces play out with the fees that brokers need to pay to accept payments, what options that could happen for these fees to go down?
There are over 500 EMI licenses issued in the EU with more than half of these registered in the UK, what are the differences among these providers?
How people are able to get incorporated and licensed to increase chances of opening a bank account
How the new fintech companies in the industry who do not possess any regulatory licenses operate their businesses and how do they add value to the industry
The type of due diligence brokers should perform on the payment solutions provider, and the precautions that brokers should take in order to safeguard their own and their clients’ funds
The future of crypto payments which have been so ubiquitous in the West, but is taking a complete new spin in Asia and money is being moved cross-borders and settled using stable coins

Episode description:Natallia Hunik discusses all things FX and financial media with Andrew Saks. We talk about journalistic standards in the industry, discuss the goods and bads of the current coverage and uncover opportunities.

Guest:
Andrew Saks , Head of Research and Analysis at ETX Capital & Founder of Finance Feeds and Natallia Hunik discuss media coverage of FX industry, its shortfalls and whether you can

https://www.linkedin.com/in/andrew-saks-23207ba/

Highlights for discussion:1. Share with the audience your background and your story. Before starting Finance Feeds you worked at other media outlets covering the margin FX industry. Why have you decided to start Finance Feeds and what made you sell it?

Let's discuss major B2B media outlets for institutional FX. You have more institutionally centered ones like FXweek, eforex publication and also the ones covering the margin FX industry like finance magnates , leaprate, finance feeds, FNG that recently emerged.
Do you feel that there is enough industry coverage? If not, why aren't there more news outlets covering the market? Generally in the news space, numerous blogs and websites have entered the financial news business and have established themselves among traditional publications.
what is your assessment of industry’s journalistic standards such as accurateness, fairness, and objectivity? From my personal experience. I see a lot less investigative journalism and analysis but more of the republishing of the companies’ news. So that goes to the topic of the podcast: can you really trust what u see in the FX news sites?
Does the concept of investigative journalism exist in the B2B Fx space? Who do you think does a good job in this ?
Journalists today seem to be pressured to take a perspective in stories, express their own viewpoints, and take a more partisan approach in writing stories than in the past. Do you think this applies for FX journalism as well?
On the retail side of things, there are in fact many alternative outlets like directories, forums (like forexfactory) where traders find opinions, commentary and discussion. Can you trust these? Are there any new alternatives?

Episode description:
Natallia Hunik discusses M&A activity trends in the margin FX sector with Demetris Tsingis, founder of Fincap
Advisors, regulated boutique Financial Advisory firm with offices in Nicosia and London specializing in authorization and post-authorization services to regulated entities.

Natallia and Demetris cover the recent sale of Finalto by Playtech, discuss what multiples can one expect when
exiting the FX business and if it's a good time to sell your brokerage.

Guest:
Demetris Tsingis
https://www.linkedin.com/in/demetris-a-tsingis-4b559a/

Highlights for discussion:
1.Share with the audience your background and your success story.

Prior to starting your own firm, you worked for a marquee consulting firm in Cyprus K.Treppides & Co.
What prompted you to start your own advisory shop?

Let's talk about specific recent mergers and acquisitions. Finalto sale by Playtech
Headline: Playtech confirms $210m sale of its Finalto financial trading division. The cash offer from the consortium is up to $210m, comprising an initial $185m, of which US$15m is deferred for up to two years from completion. A further $25m is contingent on certain cash flow or other criteria being met by the business carried on by the Finalto group. Formerly known as TradeTech, the division secured revenue of €121.9m for 2020, representing growth of 80 per cent, and adjusted EBITDA of €56.4m, up 623 per cent.

https://data.fca.org.uk/artefacts/NSM/data-migration/LSE20150402070013_012304001.html

https://data.fca.org.uk/artefacts/NSM/data-migration/LSE20170823070004_13338670.html

We are well aware that most of the deals that happen in the industry never see a public eye because companies are
private. Sometime ago, I did research based on publicly available information and calculated multiples for different
industry sub verticals. Do you think they still hold true? Has anything change?
Let's talk about Cyprus as a destination for FX brokers. Few years ago, we have seen many exit Cyprus due to
tightening regulations and ESMA rules. What are the trends? Do you see an uptick in interest given Brexit and loss
of passporting rights for the UK brokers

Dave Floyd, successful trader and fund manager, shares his life journey as a trader and how he was able to build a successful business. We will talk about treating FX as an asset class, copy trading, investment opportunities in the space and his views on FX trading platforms.

Highlights for discussion:

Share with the audience your background and your success story. Major focus on how you have built a captive audience of people who follow and subscribe to your alerts and other services. Have you contemplated several strategies for monetization? What was the thought process?
Can you talk about your FX strategy? Is it algo or discretionary? Do you trade algorithmically? Have you ever capitalized on any arbitrage opportunities in the FX market?
What do you think are the biggest deficiencies in the FX market?
I have noticed you sell copy trading products on your website. Do you see it as a global trend in FX? Anecdotally, I have heard that there are copy trading products that have tens of thousands of followers. What do you think is the best structure to get this product to work?
Worldwide, passive investment portfolios dominate active ones: https://www.statista.com/statistics/1186412/active-versus-passive-investment-portfolios-worldwide/; Do you think the copy trading trend is a form of passive FX investment?
What platforms are you using to trade currencies? Any particular ones that you think do a good job?
What is your advice to all traders out there who are looking to raise capital and build track records?
What are the top three lessons you learnt trading FX?
Why research and analytics is important to FX traders and how to research effectively without wasting time and getting lost?
How did you get into FX in the 1st place?

One of the toughest challenges for any hedge fund to overcome is figuring out how to scale the strategy. Jim Simons' fund Renaissance Technologies, started in the commodities and futures markets, but could not scale its strategies in those markets past $1 billion AUM. FX is a very fragmented market and the challenge of scaling a strategy is even more relevant as your AUM grows. During this panel, we will discuss some of the most effective ways to scale, and optimize your FX trading strategies without compromising results.

PANEL 4: Optimizing execution and scaling hedge funds
One of the toughest challenges for any hedge fund to overcome is figuring out how to scale the strategy. Jim Simons' fund Renaissance Technologies, started in the commodities and futures markets, but could not scale its strategies in those markets past $1 billion AUM. FX is a very fragmented market and the challenge of scaling a strategy is even more relevant as your AUM grows. During this panel, we will discuss some of the most effective ways to scale, and optimize your FX trading strategies without compromising results.

This is the panel discussion from FXHedgeFundExpo 2020: https://www.fxhedgefundexpo.com/landing/

PANEL 3: Turn-key hedge funds under a regulated umbrella
The umbrella fund structure makes it cheaper for investors to move from one sub-fund to another and also helps to reduce setup and maintenance costs for the investment manager. During this discussion, experts in the field will discuss various options for umbrella fund setups and weigh-in on the pros and cons of each solution, as well as diving deeper into the operational aspects of these structures.

This is the panel discussion from FXHedgeFundExpo 2020: https://www.fxhedgefundexpo.com/landing/

PANEL 3: Turn-key hedge funds under a regulated umbrella
The umbrella fund structure makes it cheaper for investors to move from one sub-fund to another and also helps to reduce setup and maintenance costs for the investment manager. During this discussion, experts in the field will discuss various options for umbrella fund setups and weigh-in on the pros and cons of each solution, as well as diving deeper into the operational aspects of these structures.

This is the panel discussion from FXHedgeFundExpo 2020: https://www.fxhedgefundexpo.com/landing/

With financial markets seeing trading costs drop dramatically over the years, many more hedge funds have entered the space. Additional entrants have brought with them more venues, more models and more technology innovation. Hedge funds greatly benefit from technology efficiencies by shortening the time-to-market, improving efficiency and margin management, decreasing trading costs and optimizing liquidity management. During this panel, experts from the field of technology will discuss technology solutions such as sophisticated front-office solutions that help achieve market-beating, risk-adjusted returns, as well as automated and integrated middle, and back-office infrastructures that deliver the operating and compliance efficiencies hedge funds need to control costs and maintain their profitability in an era of tightening fees.

This is the panel discussion from FXHedgeFundExpo 2020: https://www.fxhedgefundexpo.com/landing/

With financial markets seeing trading costs drop dramatically over the years, many more hedge funds have entered the space. Additional entrants have brought with them more venues, more models and more technology innovation. Hedge funds greatly benefit from technology efficiencies by shortening the time-to-market, improving efficiency and margin management, decreasing trading costs and optimizing liquidity management. During this panel, experts from the field of technology will discuss technology solutions such as sophisticated front-office solutions that help achieve market-beating, risk-adjusted returns, as well as automated and integrated middle, and back-office infrastructures that deliver the operating and compliance efficiencies hedge funds need to control costs and maintain their profitability in an era of tightening fees.

This is the panel discussion from FXHedgeFundExpo 2020: https://www.fxhedgefundexpo.com/landing/

FX market volatility has been suppressed by central banks for almost a decade. But 2020 is like nothing we have ever seen before: a global pandemic, geopolitical tensions and unprecedented government stimulus bills. With all these unknowns, we are looking at a very uncertain and volatile end to the second decade of this century with potential shifts in world power, US dollar dominance challenged and the role of the world's institutions potentially changed forever

This is the panel discussion from FXHedgeFundExpo 2020: https://www.fxhedgefundexpo.com/landing/

FX market volatility has been suppressed by central banks for almost a decade. But 2020 is like nothing we have ever seen before: a global pandemic, geopolitical tensions and unprecedented government stimulus bills. With all these unknowns, we are looking at a very uncertain and volatile end to the second decade of this century with potential shifts in world power, US dollar dominance challenged and the role of the world's institutions potentially changed forever.