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In parallel announcements, Hotspot, the foreign exchange market owned by BATS Global Markets, and FXall, owned by Thomson Reuters, revealed that they will limit the FX process known as Last Look, which allows FX liquidity providers a certain amount of time to reject a trade, even after it has been hit.
A key way that both platforms are limiting the practice is by reducing the amount of time liquidity providers have to reject a trade. Hotspot is shortening the time market makers have to act on a trade from 200 milliseconds to 100 milliseconds. FXall has not publicly announced the amount of time by which Last Look has been shortened, although a spokeswoman said the company has already informed clients of the planned time reduction.
In addition, the venues are implementing other methods for reducing the...