Advanced Markets Ltd., a wholesale provider of liquidity, technology and credit foreign exchange and metals brokerage solutions, has launched trading in spot crude oil, Russian ruble and Thai baht. The launch of the new products marks the firm’s entry into energy trading and expands its offering of non-G10 currencies.
The new spot oil contracts, which are trading in beta mode currently, are tied to the most widely traded delivery points and grades of crude oil: West Texas Intermediate (WTI) and Brent. Natural gas products will be launched in the coming weeks to round out the firm’s commodities complex, which includes gold, silver, platinum and palladium.
The energy products are spot or cash instruments unlike other broker offerings. Spot contracts follow spot FX conventions, including overnight rolls charged or paid as in spot FX. The cash contracts closely track trading in the related front-months crude oil futures contracts. Unlike futures there is no expiry date. Funding charges are evenly spread over the month rather than the once per month jump that is typically associated with CFDs.
“In launching energy products we saw an opportunity to add value with a differentiated, DMA spot product,” said Anthony Brocco, Executive Chairman, Advanced Markets. “In the coming weeks and months we will continue to roll out new products for our broker clients that leverage the myriad benefits of our 100 per cent DMA agency model.”
The new energy products are offered to wholesale margin clients as well as institutional clients using Advanced Markets fully segregated custody credit model offered in conjunction with Deutsche Bank National Trust. The WTI contract trades from 6:00 p.m. (Eastern) to 5:00 p.m. Sunday through Friday. The Brent contract trades from 8:00 p.m. (Eastern) to 5:00 p.m.
In addition to the new energy products, Advanced Markets has launched trading in Russian ruble and Thai baht. The ruble and baht were launched for trading July 7, following the successful debut of Chinese renminbi (CNH) trading in March.
The new currency pairs will be traded via Advanced Markets’ Direct Market Access (DMA) market structure, which enables end users to trade on liquidity provided by bank market makers in an un-conflicted, pure agency model. Initially, the currencies will be paired with the U.S. dollar. Existing Advanced Markets clients can subscribe to the new products to begin offering them for trading.