Companies big and small are discovering the benefits of automating their FX trading. The old days of spreadsheets and manual processes are rapidly giving way to a new era of rule-based robots, sophisticated algorithms and so-called application programming interfaces (APIs).
Now, Nordea has developed a new solution to make automated FX trading even more seamless and hassle-free. With the new FX Trade Retriever API, it’s not only the FX trading that can run automatically, but also the post-trade activities such as documentation and accounting.
“Combined with our other automated solutions for FX trading, this becomes very powerful,” says Patrik Holmberg, Senior Sales Manager in FX Automation and Digitalisation at Nordea Markets. “With this seamless integration between trading and bookkeeping, we are now able to offer a fully automated end-to-end process.”
The development couldn’t come at a better time. Many treasury and finance functions today are swamped with manual tasks, while also under pressure to cut costs and staff. There’s a big appetite for streamlining, automating and optimising internal processes, regardless of company size, explains Holmberg.
How does an API work?
An API (Application Programming Interface) is a software intermediary allowing two applications or systems to talk to each other. APIs allow your systems and Nordea’s systems to communicate and automatically perform tasks that would otherwise be handled over the phone or on separate platforms.
Our API products are available to customers, and, in some instances, third parties on our Open Banking Platform. To check if you have the technical integration required to connect to and use the API, you are welcome to check your workflows in our sandbox environment without any additional onboarding.
Managing FX risk in real time
Nordea offers a range of automated solutions for FX trading. AutoFX, for example, is a currency robot that trades according to a predefined framework, based on account balances. On autopilot mode, AutoFX eliminates the need to manually monitor all currency account balances and execute currency conversions. Accounts can be swept or topped up as SPOT trades or as overnight swaps.
A company might also want to have more flexibility in terms of what triggers a trade. That’s where FX APIs come into play. They can be integrated into a company’s own systems and software so that FX becomes a part of daily business, taken care of automatically. This allows FX risk to be managed in real time, for example, by letting invoice, sales, order or payment data trigger an FX trade. APIs also allow for trading a broader spectrum of products with the tenor of choice, from SPOT trades to hedging via swaps and forwards.
Such automated solutions free up time for treasurers and other financial professionals to focus on activities that add more value to the business. But they also do more than provide relief from the mundane tasks of daily FX and liquidity management. Rule-based FX trading also minimises the risk of human error and the company’s exposure to individual speculation. It ensures that currency flows are traded in line with the company’s strategy at all times.
A snapshot of our FX APIs
The FX Market Order API allows you to execute currency conversions at the current market rate via simple integration with your own preferred systems and according to your own rules and triggers. The available FX products are SPOT, forward and swap.
The FX Listed Rates API is designed for companies that want to do cross-border sales while minimising their currency risk. The API can integrate fixed currency rates directly into your applications or systems for predefined periods up to 24 hours for FX SPOT, today and tomorrow value dates as well as “weekend rates.”
The FX Pricing API allows you to retrieve real-time indicative FX rates that represent current market conditions, display them in your systems and use them as a reference for trade decisions.
With the FX Trade Retriever API, you can integrate your preferred system for a secure and automated post-trade processing of your executed FX trades at Nordea Markets.
Automation from beginning to end
With the shift to automated FX trading, one recurring request from customers has been for an automated solution for post-trade activities, including documentation and accounting.
“When you have a pre-defined, rule-based framework, that inevitably leads to more trades. That, in turn, leads to more bookkeeping and accounting – a pain point for our customers,” says Holmberg. In response, Nordea developed the FX Trade Retriever API.
“Companies can now trade in a fully automated way with APIs. You are still guaranteed the same price you would get on our other trading platforms or channels. You can still achieve best execution, now with the post-trade bookkeeping handled automatically,” he adds.
What’s more, it’s easy to get started with the API integration. One customer, with technical competencies in house, for example, was able to move from a multi-dealer platform to trading with APIs in one day.
In Nordea’s Open Banking developer portal, no additional onboarding is needed, and you can start testing your workflow immediately. When you are ready to migrate your solution to production, a Nordea FX Sales onboarding process is required. It is also possible to be onboarded onto a pre-production system based on live market data from our UAT environment. This requires a whitelisting of your IP ranges. You can register here.
Find out more about the benefits of FX automation:
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