The inability to allocate and manage credit at trading venues in real-time is a major source of risk in the global FX market.
For example, over the last ten years the number of prime brokers in the FX market has shrunk significantly, as the risk of suffering a major loss from a defaulting client has failed to justify returns. This major risk is driven by the inability to allocate and manage credit at FX trading venues in real-time, meaning the party with the credit risk is often the last to know.
Built for modern, distributed electronic markets and automated trading, Cobalt’s low latency, co-located, credit management platform utilises high-throughput technology to control credit and associated market access rules throughout the trade lifecycle in real-time. The Cobalt Core Credit Module is built to service all trading relationships, not just prime brokerage. It significantly reduces risk for the entire FX market and increases liquidity without disrupting the traditional means of execution.