FNG Exclusive Interview… Debbie Georgiou, Deriv Prime Lead, discusses the limitations of standardised liquidity and how a tailored approach can empower brokers in the evolving FX and CFDs landscape.
FNG: Hi Debbie, and thanks for joining us today. Talk to us about Deriv Prime, and how it challenges a ‘one-size-fits-all’ liquidity model to more data-driven solutions.
Debbie: In today’s rapidly evolving financial markets, the traditional ‘one stream fits all’ approach to liquidity provision is fundamentally flawed. As brokers and financial institutions navigate increasingly complex market dynamics, the demand for customised, data-driven solutions has never been greater. The notion that a standardised liquidity feed can effectively cater to the diverse needs of all brokers, regardless of their operational scale or market focus, is proving to be an oversimplification that fails to address the challenges of today’s financial landscape.
At Deriv Prime, we recognise that optimal liquidity management transcends mere access to capital. It necessitates precision, adaptability, and strategies that are meticulously calibrated to align with each broker’s risk profile and trading environment. Our core mission is to empower firms with the tools and insights they need to scale their operations and achieve sustainable growth across diverse market conditions.
FNG: What are the limitations for firms that continue to rely on standardised liquidity models?
Debbie: A standardised liquidity feed assumes that all brokers, regardless of their distinct business characteristics, can operate efficiently under the same conditions. A generic model is more likely to result in lower competitive advantage, increased costs, and diminished execution quality, especially in volatile markets where timing and adaptability are crucial.
Consider, for example, a firm within the MENA region mainly engaged in gold trading. Their liquidity requirements necessitate a specific setup that caters to the intricacies of gold hedging and regional trading practices. This level of specificity cannot be achieved through a one-size-fits-all approach and underscores the critical importance of a liquidity strategy that is not only geographically tailored but also agile enough to respond effectively to macroeconomic fluctuations.
FNG: The liquidity/PB space, especially those that serve FX and CFD brokers, seems to be somewhat crowded, with a number of well-capitalised, entrenched incumbents. How do you differentiate Deriv Prime as a preferred partner for brokers and others in the business?
Debbie: At Deriv Prime, we employ a data-centric approach to liquidity management that allows brokers to gain actionable insights into their trade flows, client behaviours, and market dynamics through a multi-faceted approach.
In-depth Trade Flow Analysis: We conduct a comprehensive analysis of our clients’ trade flows, aiming to identify operational bottlenecks and areas for enhancement. This granular examination yields valuable insights into the precise types of liquidity that would most effectively support their activities.
Customised Liquidity Solutions: Following the trade flow analysis, we architect tailored liquidity streams that optimise execution quality while minimising market impact. This includes adjusting pricing models, allocating dedicated liquidity pools, and integrating sophisticated risk management tools.
Continuous Diagnostics and Optimisation: We then monitor and refine our liquidity streams on an ongoing basis to ensure they remain aligned with the dynamic nature of market conditions and evolving client needs.
FNG: What changes do you see on the horizon for the online trading industry? How is Deriv Prime planning to position itself as the industry evolves?
Debbie: Our industry is at a pivotal point of transformation, driven by increasing regulatory complexity, growing demand for more transparent and efficient execution, and a shift towards more personalised client experiences. In this evolving landscape, data and technology will become the primary catalysts for innovation.
At Deriv Prime, we aim to leverage advanced technologies, such as AI, machine learning, and real-time analytics to help brokers make smarter, data-driven decisions and enhance execution speed and accuracy while navigating complex trading environments.
We’re also closely watching the potential of blockchain. While still in the early stages, distributed ledger technology could create a more efficient and secure way of managing trades and settlements. As these innovations gain traction, Deriv Prime is committed to providing scalable, adaptive solutions to help brokers overcome operational challenges and achieve sustainable growth.
FNG: What else can we expect to hear from Deriv Prime in the coming months?
Debbie: For 25 years, Deriv has been committed to making trading accessible and empowering traders globally. Our extensive experience gives us a deep understanding of the challenges and opportunities brokers face, enabling us to deliver solutions that are both effective and relevant.
We’re committed to continuously refining our data-driven strategies to offer brokers deeper insights into client behaviours and market trends, enabling them to anticipate market shifts and make more informed decisions.
Looking ahead, Deriv Prime will be introducing alternative risk management and hedging solutions specifically designed to meet the diverse needs of institutional clients, particularly for asset managers, hedge funds, proprietary trading firms, and brokers.
Ultimately, our goal is straightforward: to equip our clients with the solutions they need to navigate and succeed in a rapidly changing financial landscape.
