Electronic Broking Services
Electronic Broking Services (EBS) is a wholesale electronic trading platform used to trade foreign exchange (FX) with market making banks. It was originally created as a partnership by a number of the world's largest banks and is now part of ICAP.
History
EBS was created by a partnership of the world's largest foreign exchange (FX) market making banks in 1990 to challenge Reuters' threatened monopoly in interbank spot foreign exchange and provide effective competition. By 2007, approximately USD 164 billion in spot foreign exchange transaction, 0.3 million oz in gold and 1 million oz in silver as well as 200,000 ounces of Platinum and Palladium were traded every day over the EBS Spot Dealing System.
EBS's closest competitor is Reuters Dealing 3000 Spot Matching. The decision by an FX trader whether to use EBS or Thomson Reuters Matching is driven largely by currency pair. In practice, EBS is the primary trading venue for EUR/USD, USD/JPY, EUR/JPY, USD/CHF and EUR/CHF, and Thomson Reuters Matching is the primary trading venue for commonwealth (AUD/USD, NZD/USD, USD/CAD) and emerging market currency pairs.
EBS was the first organisation to facilitate orderly black box or algorithmic trading in spot FX, through an application programming interface (API). By 2007 this accounted for 60% of all EBS flow.
EBS was acquired by ICAP, the world’s largest inter-dealer broker, in June 2006. ICAP said that the acquisition would combine EBS’ strengths in electronic spot foreign exchange with ICAP’s Electronic Broking business to create a single global multi-product business with further growth potential and significant economies of scale. It went on to say that would provide customers with more efficient electronic trade execution, reduced integration costs and give access to broad liquidity across a wide product range.[1]
Structure
Products of the company include:
- EBS Spot (electronic FX spot broking)
- EBS Spot Ai (application program interface (API) between the customer’s trading system and the EBS Spot market)
- EBS Prime (access for the interbank and professional trading communities to the best EBS Spot prices from an EBS Prime bank)
- EBS Metals (electronic spot broking for the precious metals market)
- EBS NDFs (electronic spot broking for non-deliverable FX pairs)
- EBS Live (live streaming prices delivered with minimum latency direct from EBS to the customer's market data distribution platform)
- EBS Ticker (third-party system distribution of EBS Spot prices)
- EBS Rates (desktop view of EBS Spot prices, available through the Thomson Reuters Eikon and 3000xtra desktop as well as the Bloomberg Terminal service)
- EBS Data Mine (unique and certified historical data from 1997 onwards)
References
- ↑ ICAP Agrees to Buy Electronic Currency Broker EBS, Hamish Risk and Andrew Reierson, Bloomberg, 2006-04-21