FiNETIK – Asia and Latin America – Market News Network

Asia and Latin America News Network focusing on Financial Markets, Energy, Environment, Commodity and Risk, Trading and Data Management

Mexico´s Exchanges take huge steps to boost High-Speed Trading.

The Mexican Exchange, which is the second largest exchange in Latin America, announced a number of strategic and technology initiatives designed to promote foreign investment in the Mexican financial markets and its position as a Latin American leader in high-frequency trading.

While Brazil continues to be the hottest emerging market in Latin America, the Mexican Exchange (BMV Group), is taking huge steps to boost its growth in the high-speed marketplace.

The Mexican Exchange, which is the second largest exchange in Latin America, announced a number of strategic and technology initiatives designed to promote foreign investment in the Mexican financial markets and its position as a Latin American leader in high-frequency trading.

Mexico now provides worldwide participants with seamless, high-speed and efficient access through low touch direct market access (DMA), high speed co-location services, and FIX standard protocol for order routing and market data Part of Mexico’s success is down to its determination to improve its operative rules to better comply with international market standards, as well as adopting new technology.

In 2012, the Mexican Exchange will announce the launch of a new trading engine, internally developed. This multi-market, multi-asset, flexible and scalable trading engine has throughput of more than 200,000 messages per second. The trading engine will be ultra low latency, executing trades in 100 microseconds roundtrip (improvement over 25 milliseconds on legacy trading system). Full deployment is planned for Q2 2012. Further in 2012, The Mexican Exchange will introduce several new initiatives including midpoint hidden order book trading, aimed at institutional investors looking to trade large blocks anonymously with reduced execution risk. Simpler cross order rules will also be implemented; all stocks, global market equity securities and debt instruments will be crossed within the best bid/ask spread with no intervention. And, VWAP executions for the day will be able to be entered from 8:00 AM CT to 2:40 PM CT.

Recently, the Mexican Exchange has established major alliances broadening investment opportunities in the Mexican market. The Mexican Derivatives Exchange (MexDer) and the Chicago Mercantile Exchange (CME) established phase one, “south-to-north,” of its strategic order routing agreement, giving Mexican investors access to CME Group’s benchmark derivatives contracts, including interest rates, foreign currencies, equity indexes, energy, metals and agricultural commodities.

Phase two of the partnership, “north-to-south,” now in place provides CME Group customers with access to MexDer benchmark products, including Mexican Stock Exchange Index futures, bond futures and MXN Peso / US dollar futures contracts.

Source: Wallstreet&Technology, Melanie Rodier, 18.11.2011

Filed under: BMV - Mexico, Exchanges, Latin America, Mexico, , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Mexican Exchange Readies New Trading Platform, Forms New Relationships

Sell-Side Technology | 18 Nov 2011 | 20:07

Mexican exchange operator Bolsa Mexicana de Valores (BMV) plans to launch a new, as yet unnamed matching engine, which will deliver 100-microsecond message latency compared to the 25-millisecond latency of its current equities platform, and will offer the same performance as Singapore Exchange’s (SGX’s) platform. The engine will also support more than 200,000 messages per second, up from the 9,000 messages per second of its legacy trading system.

 BMV CEO Luis Téllez Kuenzler and other exchange officials spoke about these upgrades and the state of the Mexican economy at the second annual Connect & Trade Mexico event this week in New York.

Téllez Kuenzler says the improvements should attract attention from the high-frequency trading (HFT) community, which already makes up 20 percent of trading volume in the country even though HFT in Mexico began only two-and-a-half years ago.

“By successfully improving upon our operative rules to better comply with international market standards, BMV is now better equipped to provide global investors with more efficient trading and connectivity to Mexico,” Téllez Kuenzler adds.

Other functionalities will go live in January, says Jorge Alegria, senior vice president of BMV and CEO of the Mercado Mexicano de Derivados (MexDer) derivatives exchange, which is a BMV affiliate. One of these functionalities is a non-displayed midpoint order book for institutional investors looking to trade large blocks anonymously with reduced execution risk. Old rules regarding crossing trades will also be replaced; all stocks, global market equity securities and debt instruments will be crossed within the best bid/ask spread with no intervention, according to Alegria.

In August, MexDer and the Chicago Mercantile Exchange (CME) established a south-to-north order-routing agreement, which was followed by a north-to-south agreement. It gives Mexican investors access to CME Group’s benchmark derivatives contracts, including interest rates, foreign currencies, equity indexes, energy, metals and agricultural commodities. And it gives CME customers access to MexDer benchmark products, including Mexican Stock Exchange Index futures, bond futures and peso/dollar futures contracts.

The Mexican exchanges are also considering an invitation from the Mercado Integrado Latinoamericano (MILA)—a trading network among the exchanges of Chile, Peru, and Colombia—to join its network. In the meantime, BMV has signed an order-routing agreement with Chile and is working on another with Brazil’s BM&FBovespa exchange.

“The flow between Mexico and Brazil can be huge,” says Téllez Kuenzler.

Source: WatersTechnologis, 18.11.2011

Filed under: BMV - Mexico, Exchanges, Mexico, , , , , , , , , , , ,

Finamex launches Algorithms with US Equities in the Mexican market

Finamex, a full-service independent broker dealer from Mexico City, and leading provider of innovative trading solutions, has released four opportunistic market trending algorithms for use by Direct Market Access (DMA) clients. The main idea is to allow clients to effectively gain arbitrage profits while mitigating collocation and/or their own strategy development costs.

Finamex’s latest release of arbitrage algorithms have been designed to build opportunities on fungible domestic equities displayed in the Mexican exchange marketplace. Execution calculations work through pre-programmed algorithms built on leveraging theoretical quote pricing as the primary driver of behavior, speed and momentum.

There are a variety of features to how the Finamex arbitrage algorithms provide opportunities with US equities in the Mexican market:

1. Hunter – is an algo which seeks to take advantage of sudden inefficiencies between the equities of foreign listed symbols in Mexico versus their originating market (such as the QQQ or AAPL on the Nasdaq or NYSE markets). The Hunter algorithm computes required data-sets and adjusts itself independently within defined price spreads on the Mexican Stock Exchange (Bolsa Mexicana de Valores: BMV).

2. Ghost – has a characteristic of lying dormant until a desired buy/sell signal appears with a non-previously indicated ask/bid price then it executes contrarily. Similarly with the Finamex “Hunter” algo, Ghost receives the side, quantity and spread parameters of opposing bids/offers satisfying spread parameters of its local market yet quickly hitting IOC type status. This feature helps in the recognition of desired price opportunities without revealing trade strategy intentions by its clients.

3. Scaled – uses a two-spread metric like the Hunter algo, with a signal that triggers in a suddenly inefficient environment. The Scaled algo strategy is seen on a big spread definition, called a “base.” Scaled reacts instantaneously when a lower spread, called the “target”, is satisfied on the other side. Unlike the Finamex “Ghost” algo, the Scaled algo’s intentions are exposed but move immediately when the target spread is satisfied. The Scaled strategy allows other market participants to preview this algo’s activity, causing them to sometimes take a glance on the board, which in turn drive executions over the spreads.

4. Market-maker – a next generation algo intended to provide liquidity and act as a market maker within the local Mexican marketplace. Market-maker absorbs the last trade, adds an indicated spread and automatically places or replaces the order with an indicated quantity. In combination with pegging and short-sell models, the Marketmaker algo is highly beneficial for market making strategies and for acting on market divergences.

“We’re putting in place all of these free strategies for clients who want to access the Mexican stock market with an almost-zero setup price. Our goal is to take Mexico to a higher level in the emerging markets priority list of global investors,” states Hector Casavantes, head of Electronic Trading at Finamex. “We wanted to offer automated algo strategies in order to let investors know how active and easy this market can be to trade. All algorithms were architected with profitability in mind. They’re highly customizable, completely auditable and comprehensive, fully meeting our clients’ demands”.

“With the addition of these tools, we’ve further enhanced our suite of algorithmic-trading products beyond our well-known execution algos in VWAPs, TWAPs, Implementation Shortfall and POV, “Roberto Larenas, Head of Equity Markets at Finamex added. “While we are aware that these algos are more opportunistic, we are still keeping our business model as pure-agency. Buy-side firms are increasingly requesting new tools, new ideas, and new ways to exploit opportunities in emerging markets. Finamex is fully committed in addressing these demands with our best-of-the breed solutions

Source: A-Team, 14.11.2011

Filed under: BMV - Mexico, FIX Connectivity, Latin America, Mexico, Trading Technology, , , , , , , , , , , , , , ,

Mexican Market Leaps Forward – FIX, Technology, Co-Location and Regulation

In the last 12 months dramatic changes have occurred at Mexico’s stock exchange and among its brokerage clients. Cross border partnerships, technology upgrades, new FIX infrastructure and business friendly regulatory changes have opened the Mexican market to high frequency trading (HFT).

While US regulators can be seen to scold HFT firms, the Mexican market has opened its arms. The Mexican Exchange (BMV) and its brokerage firms have upgraded their infrastructure and sought business opportunities north of the border. Earlier this year after the CME Group and the BMV signed their partnership, high frequency traders on the CME Globex trading system began to route orders to the Mexican Derivatives Exchange or MexDer. Today 90 percent of average daily volume on the MexDer comes from high frequency traders north of the border.

Mexico’s brokerage firms have completed significant infrastructure upgrades. Last spring only a few brokers in Mexico could handle a highfrequency hedge fund client and many Mexican brokers could process no more than one connection to the Bolsa Mexicana de Valores (BMV) at a time. The landscape has changed quickly and improvements in broker and exchange systems have ushered in a new capacity for speed in the transmission and execution of orders in Mexico.

Over the summer a major milestone occurred for the industry. Working with the BMV, Mexico’s brokers completed an industry-wide upgrade to FIX 4.4. The top 25 brokers are now certified with FIX 4.4 to the BMV. Leading the way, are brokerages like GBM, Interacciones, Actinver, UBS Mexico, IXE and others.

Now that Mexican brokers speak FIX 4.4, all of the order routing to the BMV can now be done through FIX allowing the BMV to retire the antiquated SETRIB protocol. The only way the BMV will allow Mexican brokers to continue to use SETRIB is by paying excessive fees, and even this will not be allowed by the end of 2011. Retiring SETRIB sets the stage for more positive changes in the industry and at the BMV.

Work is already underway to upgrade the BMV’s trade matching engine. The existing engine was built in the 1990s for a Tandem mainframe. Retiring the Tandem has many benefits. Faster order matching and processing is high on the list. In addition, more choices for application and software vendors and significant cost savings are expected. Retiring the mainframe will also eliminate the scheduling nightmares associated with the limited availability of the central mainframe for testing with the broker community. The new matching engine will be hosted on modern Unix based hardware. The release of the new matching engine and infrastructure is planned for the first quarter of 2012.

Another important milestone is the availability of a state-of-the-art co-location facility at KIO Santa Fe. The BMV infrastructure is located here and starting in October it will be easy for brokers and third party providers to collocate order routing and market data in this hosting facility leading to high throughput low latency services.

While all of the infrastructure and matching engine upgrades are momentous, they would bear no fruit without the simultaneous modernization of Mexican regulations. The initiative to modernize Mexico’s regulations, called RINO, began a year ago and phase two is due to rollout in the fall of 2011. The goal of RINO is to conform Mexican regulations to international standards. By converging with international standards, regulators hope to bring more international order flow and greater liquidity to the market, resulting in increased investment in the Mexican market.

While regulations in the US like Sarbanes Oxley and Dodd-Frank can be seen to drive businesses offshore, the regulatory changes in Mexico are removing handcuffs from businesses and facilitating opportunities. The first step forward occurred early this year with RINO I. RINO I allowed brokers to have multiple channels to the BMV’s electronic trading system. Previously all orders were in a single queue. Multiple access points per broker provides more flexibility in executing strategies and handling client requests, including separate BMV channels for program trading and orders called into the trading desk. RINO I also eliminated sizebased criteria from order management,  thus leveling the playing field in the processing of orders. RINO II takes effect on October 10, 2011, bringing more modernizations including pegged orders, improvements in crossing operations, average price operations, price delivery regardless of volume, and decimal bids for fixed income securities.

Crosses, in which a brokerage carries out a transaction through the stock exchange between two of its clients, were permitted previously but the rules were very arcane. Starting in October, the crossing operations will be vastly simplified allowing clients to simply choose whether to cross inside or outside the spread. With this modernization, the BMV hopes to repatriate orders that brokers would previously carry out in the US, where crossing orders was possible using ADRs in dark pools or at the NYSE.

In addition the RINO II regulations a very important new mid-point hidden book order. The orders execute at the midpoint, broker anonymity is guaranteed and the order priority is determined by volume. This is effectively a dark pool. Similar to Xetra, this new BMV order helps the market participants and simultaneously protects the BMV from  providers toying with moving into the Mexican marketplace.

As the regulations modernize and the FIX infrastructure hardens, opportunity beckons. Brokers are beginning to push for more high frequency trading algorithms, more efficient routing of international orders, and more sophisticated risk controls, all of which will attract even more international business. As the need for speed grows, co-location previously offered by the exchange may become more strategic, particularly to brokers wanting to attract high frequency traders.

All of this progress was made possible in large part because of the exchange’s demutualization and subsequent listing in 2008. The demutualization coincided with rule changes allowing Mexico’s pension funds or AFORES to invest. Before the rule changes, the AFORES were forced to invest almost entirely in short-term government paper. Today, Mexico’s pension funds are allowed to invest up to 25 percent, in individual stocks and shares and 12 percent in a hybrid of corporate debt and equity capital to allow companies to raise funds to expand businesses.

Considered together, regulatory improvements and infrastructure updates have morphed the BMV and the Mexican brokerage community into a thriving and modern marketplace. The BMV reported a 22 percent jump in earnings last year, with operating income increasing 70 percent in the last three months. A record six initial public offerings made it to market last year and overall trading volumes rose 50 percent in 2010. This year Mexico’s IPC index has tested and hovered near record highs.

In 2011 there are fewer IPOs, but trading volume remains strong. The order-routing agreement signed with Chicago’s CME Group has opened Mexico’s derivatives market to the world. Now, electronic trading infrastructure and investor friendly regulations have set the stage for act two.

Latin America has enjoyed a strong recovery for the most part it has sailed through the recession without lasting damage. Boosted by capital inflows, by record prices for commodity exports, by sound policies and by a heady expansion in domestic credit, the region saw economic growth of 6% last year and is on course to notch close to 5% this year. The region faces slower growth but not disaster. To up the pace, now is the time for reforms to boost productivity.

The main engines for growth in Latin America are China’s demand for minerals, food stuffs and raw materials – this looks set to continue – and consumption as tens of millions edge out of poverty and benefit from newly available credit.

Source: FIX Global Trading, 15.09.2011

Free Subscription of FIX Global Trading Magazin at http://fixglobal.com/subscription

Filed under: BMV - Mexico, FIX Connectivity, Latin America, Market Data, Mexico, News, Risk Management, Trading Technology, , , , , , , , , , , , , , , , , , , , , , , , , ,

ITG Launches Algorithms for Mexican Equities

Investment Technology Group, Inc. (NYSE: ITG), a leading agency research broker and financial technology firm, today announced the launch of algorithms for Mexican equities, including the proprietary Active algorithm, which has been customized for the structure and spread profile of the Mexican market. The algorithms are available via ITG’s award-winning Execution Management System, Triton®, as well as other widely used trading platforms and via FIX connection.

“Regulatory and technological changes are accelerating the move towards electronic trading in Mexico, and our tailored algorithms provide a valuable new tool for institutional asset managers seeking to access that market,” said Jeff Bacidore, Managing Director and Head of Algorithms at ITG. “These algorithms are designed to reduce market impact, maximize execution quality and improve trading performance in the Mexican equity market.”

The Mexican algorithms complement ITG’s growing Latin American trading capabilities. ITG offers a full suite of algorithms for Brazilian equities, including Active, Flexible Participation, Volume Participation and the recently added Peg & Pounce algorithm. Peg & Pounce empowers traders to take liquidity opportunistically when the size is available and supply liquidity passively when liquidity is not available.

Source: Bobsguide, 20.09.2011

Filed under: BMV - Mexico, FIX Connectivity, Latin America, Mexico, News, Trading Technology, , , , , , , , , ,

10 Trading Trends in Latin America : SunGard

Raj Mahajan, president of SunGard’s global trading business, said: “The economy in Latin America continues to grow at an exceptional pace. Led by Brazil, which has achieved an annual average growth of 3.7% over the last ten years, (nearly twice that of the US), the boom includes Mexico, Chile, Columbia and Peru. SunGard is helping Latin American trading firms capitalize on the change and growth in that region, by providing low latency execution to help them compete in the global race for liquidity with greater transparency, efficiency and access to network connectivity.”

The ten trends SunGard has identified as shaping Latin American trading are:

1. Mexico, Chile, Columbia and Peru are quickly gaining recognition as key markets in Latin America, as their combined trading volumes edge closer to Brazilian levels.

2. Brazil’s markets are going completely electronic, increasing firms’ ability to more efficiently and more quickly access liquidity. As a result volumes have skyrocketed; a 400% increase in activity in the last decade.

3. Demand for international order flow is high as volumes are rising in emerging markets: Brazil is ranked the fourth largest emerging market according to a recent article.

4. The sell-side in Latin America is consolidating; large international players are buying local brokers to quickly increase their presence and credibility.

5. FIX connectivity is increasing: As firms receive and execute more order flow internationally, the adoption of FIX has taken hold in Latin America, helping to efficiently connect buy- and sell-side firms.

6. Trading volumes are increasing across the region and firms need real-time data and analytical tools for greater transparency into market movements. It is predicted that Brazil will see a 4.9% increase in equity market performance in 2011, according to a recent report. From 2006-2010, fund flows into Brazil have totaled $10 billion.

7. As more international investors want exposure to LatAm markets, the networks into and out of these markets becomes more important. Local firms and international players are investing in telecommunications infrastructure to ensure bandwidth and reliability for their trading networks.

8. With major exchanges allowing third party software firms direct access to exchanges, traders have more network connectivity options and can now take advantage of independent software vendors to provide their technology platforms.

9. As LatAm trading volumes skyrocket, the demand for financial information within the region is growing. In terms of financial market data and news, Latin America is second only to the Asian nations in allocating more budget for this resource.

10. LatAm trading firms are investing in low latency execution and stable customizable trading solutions, leaving legacy technologies behind for greater operating efficiency.

Danielle Tierney, junior analyst at Aite, said, “Networks are the key to sustaining growth in Latin America. Approximately 25 percent of the volume traded in Latin America is international, driving the search for new sources of liquidity and establishing connections to powerful global networks.”

Sourc: SunGard, 12.09.2011

Filed under: Argentina, Brazil, Chile, Colombia, Data Vendor, Exchanges, FIX Connectivity, Latin America, Market Data, Mexico, Peru, Trading Technology, , , , , , , , , , , , , , , , , , , , ,

CME and MexDer implement north-to-south order routing

CME Group, the world’s leading and most diverse derivatives marketplace, and the Mexican Derivatives Exchange (MexDer), the derivatives subsidiary of the BMV Group and second largest exchange in Latin America, today announced the successful launch of their north-to-south order routing agreement, giving customers in the U.S. access to MexDer’s benchmark derivatives contracts, including Mexican Stock Exchange Index Futures, Bond Futures and MXN Peso / US Dollar Futures Contracts.

The first phase of CME Group’s strategic partnership with MexDer went live April 4, 2011 and gave Mexican investors access to CME Group’s benchmark derivatives contracts including interest rates, foreign currencies, equity indexes, energy, metals and agricultural commodities.

“Mexico is the 13th largest economy in the world and we continue to look for opportunities to provide our customers around the world with the broadest and most diverse range of globally-relevant products to help them manage their risk,” said Phupinder Gill, CME Group President. “This next phase of the partnership demonstrates how we continue to build on our successful track record of growing our business internationally through strategic partnerships.”

“With the successful launch of South-to-North order routing in April, the second phase of the direct order routing connection now makes it possible for both of our customers to leverage access to both MexDer and CME Group, and take advantage of a modern market with a friendly regulatory framework in Mexico and a growing sophisticated local investor base,” said Luis Tellez, Chairman and CEO of BMV Group. “Our goal moving forward is to focus on increasing our volumes together and working more closely with each other to learn how we can meet the needs of our customers.”

In March 2010, the parent company of MexDer, BMV Group, and CME Group entered into a strategic partnership that includes order routing for derivatives products as well as an agreement to pursue potential joint initiatives including product development, marketing and customer education as well as clearing opportunities. CME Group is the exclusive exchange provider of derivatives order routing services to MexDer outside Latin America, and MexDer is the exclusive exchange provider of derivatives order routing services to CME Group in Mexico.

Source: BMV 01.08.2011

Filed under: BMV - Mexico, Exchanges, FIX Connectivity, Latin America, Mexico, News, Risk Management, Trading Technology, , , , , , , , , , , , , , , , ,

FT Special Report: Investing in Mexico

Read the FT Special Report at Investing in Mexico FT Special Report June 2011

 

Boom times despite safety fears

There has been a rise in violent crime in some areas, but the country is still a good place for business, says John Paul Rathbone

Better government and smarter leadership, combined with strategic vision, could change Mexico very swiftly, writes Luis Rubio

Regulation: Media wars give hope of more choice

Competition, once an infrequent and timid visitor, is making a loud return, says Adam Thomson

Politics: Reform on hold as all eyes turn to elections

The PRI is tipped to regain the presidency but it is not all plain sailing, writes Adam Thomson

Industry: Aerospace sector helps high-tech economy fly

Advanced manufacturing skills are boosting exports, writes Adam Thomson

US relationship: Bumps on road to better links

Differences persist on guns, drugs and illegal migrants, says Anna Fifield

Still everything to play for in face-off with BrazilJohn Authers considers the nation’s rivalry with Brazil and asks whether there is all still to play

Stock market: Changes give vigour to once-somnolent bourse

Technical and other alterations facilitate business, reports Adam Thomson

Tourism: Aggressive push to promote country’s multifaceted allure

The nation’s tourism industry is working hard to persuade visitors there is more to discover, writes Adam Thomson

Mexico City: Conditions improve for business

A string of liberal social reforms during the past few years has led some observers to rename Mexico’s capital ‘Marcelona’, writes Adam Thomson

FT Special Report, 13.07.2011

Filed under: BMV - Mexico, Brazil, Library, Mexico, News, Risk Management, , , , , , , , , , , , , , , , , , , , , ,

Fidessa Launches Sell-Side Trading Solution for Mexico

April 7, 2011,  TheTrade Fidessa launched a new platform for brokers tailored specifically for trading in Mexico, following the introduction of new market regulations in September 2010.

Fidessa clients will have functionality for trading across asset classes that is compliant with new routing and order prioritization rules introduced by domestic exchange Bolsa Mexicana de Valores (BMV) in conjunction with trade body the Mexican Securities Industry Association and Mexican regulator, the Comisión Nacional Bancaria y de Valores. Specific to Mexico, the platform allows brokers to establish multiple channels to the exchange using separate FIX connections and supports all the new order types made available by the changes to regulation.

According to the BMV, “Average daily orders in the Mexican cash market have increased threefold over the past year, and as global investors look to Mexican markets for new opportunities, we remain focused on improving functionality and trading rules. By working with a company such as Fidessa, which has developed solutions to address regulatory changes like MiFID in Europe and RegNMS in the US, we are taking another big step towards increasing foreign interest and investment in Mexico.”

Source, Fidessa 07.04.2011

Filed under: BMV - Mexico, Exchanges, FIX Connectivity, Latin America, Mexico, Trading Technology, , , , , , , , , , , , ,

NYSE Technologies expands SFTI Network to Mexico – Interacciones Casa de Bolsa (ICB) as Prime Destination

Interacciones Casa de Bolsa of Mexico (ICB) and NYSE Technologies, the commercial technology division of NYSE Euronext, today announced that ICB has joined the Secure Financial Transaction Infrastructure (SFTI) as a prime destination to Mexico.

“NYSE Technologies is excited to work with one of Mexico’s leading capital markets firms on a project that further opens Mexico to more global investors while also bringing the global markets closer to local investors,” said Stanley Young, CEO, NYSE Technologies.  “When combined with our industry-leading technology, global footprint and unparalleled customer community, Interacciones’ extensive coverage in Mexico and its focus on facilitating foreign investors in Mexico will enable us to jointly implement a new breed of direct market access solutions unlike anything available in the region.” 

Raúl Garduño, CEO and General Manager of ICB said “Connection to SFTI is an important step in a larger commitment to invest in next-generation electronic trading technologies. Buy-side clients in North America and Europe will have access to a complete provider of investment services in Mexico from custody to asset management, foreign exchange, research for equities, derivatives, fixed income products and stock loan. As we continue our international expansion, ICB will work further with NYSE Technologies to build and expand this technology platform, providing international investors with robust, innovative solutions for trading electronically in our markets.”

NYSE Technologies’ SFTI network is the highly resilient, ultra low-latency communications backbone created for the financial industry in 2002.  It provides connectivity to multiple exchanges, market centers and content service providers, including all of the National Market System venues in the U.S.  SFTI also connects to over 1,300 market participants and offers third-party technology products through its unique hosted solutions platform.   Designed to be the industry’s most secure and resilient network, SFTI is specifically built for electronic trading and market data traffic thus enabling firms to reduce their time-to-market, improve their performance and significantly lower the cost of their trading infrastructure.

Source: MondoVisione,23.02.2011

Filed under: FIX Connectivity, Mexico, Trading Technology, , , , , , , , , , ,

Mexico: Economy Continues Slowly to Our Targets – November 2010- IXE BANIF – Monthly Analysis

Mexican growth motors continue to balance out

Since last month, we have experienced a re-balancing of growth drivers, with improvement of local demand and a slow-down in exports, the main growth motor. Exports have reduced their YoY growth rate from the nearly 50% of the beginning of the year, although it remained at a high 21% in September. We expect this deceleration to continue until 2011.

Mexico – Monthly Allocation – November 2010

During October, we renewed our good expectations for growth of the Mexican economy with the release of statistics for September: a) Internal retail sales increased 4% YoY; b) consumer confidence grew 12% YoY; c) 780k new jobs created in the first nine months. Concerning job creation, this level was a record high for the same period and mainly due to the export industry. We maintain our expectation for the creation of 650k new jobs in 2010 (seasonally, there is job reduction at year-end) and 530k in 2011.

Despite these changes in export and local demand, we maintain our expectation of a 4.4% GDP growth for 2010 (while market consensus remain at 5%) and 3.7% for 2011. For our 2011 forecast, local demand still has to catch up, as we predict a further decline in exports.

For our November portfolio, we have added Femsa and increased the weight of Grupo Mexico from 15 to 20%. We have reduced the weight of Mexchem from 15 to 10% and withdrawn Soriana.

Mexican tidbits

Inflation remains under control, although the first data collected for October, indicating a 0.5% increase, was slightly above our and market expectations. We continue expecting 4.5% for 2010, with the belief that interest rates increase no earlier than October 2011, although the growth of inflation in the recent past may allow postponement to the beginning of 2012.

The Mexican Peso reduced its volatility in October, appreciating from the 12.6 P$/US$ at the beginning of the month. Our forecast is currently at 12.4 for the end of 2010 and 12.2 for the end of 2011.

Source: Banif – IXE, 05.11.2010

Filed under: BMV - Mexico, Latin America, Mexico, News, Services, , , , , , , , ,

Mexico: Economy Steady in Low Gear – October 2010- IXE BANIF – Monthly Analysis

Motors of Mexican growth start balancing out

As we mentioned last month, the Mexican economy has slowed down. Our forecasts for GDP growth remain unchanged at 4.4% and 3.7% for 2010 and 2011, respectively, in line with Government expectations (of 4.5% and 3.8%). We believe that the economy will not slow down further and that export and local demand will become more equitable. While the slower growth of the US economy reduces the prospects for exports, local demand has started to improve, as seen by the 2Q10 YoY internal consumption growth of 4.8%.

Locally, the Mexican construction segment continues the weakest in the industrial sector, with manufacturing leading the economy. As local demand picks up, we foresee a change in consumption from non-durable to durable goods.

Mexico – Monthly Allocation – October 2010

A political discussion on the budget for 2011 will start in Congress in November. We believe that this is likely to bring volatility to the market, as it should affect the Mexican currency and local bonds. Prudent fiscal policies are likely to continue and we expect the government to propose a cut in fiscal deficit. We also believe that this proposal is already expected and, at least partially, priced in.

Mexican tidbits

Inflation is apparently under control, after positive signs that led the government to admit that its 5.25% target for the year is high and that it should converge to market consensus’ 4.5% (our forecast continues at 4.7%).

After the volatility of the Mexican Peso in August, we believe that the rally is likely to cease and our new expectations for the FX are of 12.4 (from 12) and 12.3 pesos per US dollar by the end of 2010 and 2011, respectively. We base this expectation on the belief that cyclical inflows other than exports, such as remittances (linked to US employment), tourism (linked to US consumer confidence) and foreign direct investments (linked to US private profits) are likely to remain weak.

For October, we have reduced the total number of names in our portfolio from 11 to 8. We have added Soriana and increased the weights of LABB (from 5 to 10%) and Mexchem (from 5 to 15%). We also have withdrawn Chedraui, Femsa and Televisa.

Source: Banif-IXE, 04.10.2010

Filed under: BMV - Mexico, Exchanges, FIX Connectivity, Latin America, Mexico, News, , , , , , , , , , , ,

Mexico: Drifting Toward Troubled Waters – September 2010- IXE BANIF – Monthly Analysis

Slow US economy decreases Mexican expectations

The structure of the Mexican economy is unchanged when it comes to the breakdown between local and export markets, and we base our expectation for Mexican economic growth on both markets. We continue to expect a 4.4% GDP growth for 2010 (growths of 4.3%, 7.6%, 4.0% and 1.9% for each quarter, sequentially) while other, more aggressive houses, have reduced this from 5% to nearly 4%.

Despite the most recent reduction in 2H10 growth expectations, we maintain our figure in the belief that the local market will compensate for a likely weaker export scenario that heavily depends on the US economy.

We have assumed since last month that the US would grow at a lower than previously expected pace. Locally, the Mexican construction segment has been the weakest in the industrial sector, while manufacturing has led the economy. We expect export companies, which have been suffering from the weaker foreign market, to recover by year-end, although car exports have performed well even during these tougher times.

Mexican tidbits

Mexico’s inflation has been increasing and, from the current annualized 3.7%, we maintain our expectation of it reaching 4.7% by year-end. We believe that our expectation of interest rate hikes in 3Q11 might become market consensus soon.

The FX has moved negatively lately, after three months without definite direction. It has surpassed the P$13/US$ line, the worst level since the end of June. We still expect it to be at P$12 by year end but, if we do not see a downward movement over the next weeks, we might change this expectation to a P$12.25-12.35 range. We do not believe this potential change in the FX scenario would cause any change to Mexican exports, with the main driver here continuing to be the strength of the US economy (and demand).

For August, we have added Alsea and Femsa to our portfolio and increased the weights of America Movil (from 20% to 25%) and Walmex (from 10% to 15%). We also reduced the weights of GenomaLab and Geo (from 10% to 5%), and have withdrawn Cemex.

Read the full market analysis Mexico – Monthly Allocation – September 2010

Source: IXE-Banif, 01.09.2010

Filed under: BMV - Mexico, Latin America, Mexico, News, Risk Management, , , , , , , ,

Mexico’s GBM Champions FIX Flyer’s Software for Electronic Trading

FIX Flyer, a leader in solutions for electronic trading, announced today that Grupo Bursatil Mexicano, one of the leading brokers in Mexico, uses both the Flyer Engine and Daytona Monitoring for their FIX messaging.

GBM uses Flyer’s tools for their client order flow as well as routing to exchanges in Mexico, Brazil and North America. GBM uses Daytona and the Flyer Engine to monitor and support FIX sessions with all of their counterparties in real-time. In addition, the combined solution lets GBM’s traders respond to their clients needs with dynamic trade busting, routing latency metrics, and real-time order chain management. By providing even higher levels of support for their customers, GBM is in a strong position to attract clients beyond Mexico.

FIX Flyer is also working closely with GBM to integrate with the Bolsa Mexicana de Valores’ new FIX offering. The Bolsa, the largest equities exchange in Mexico, will soon support orders from FIX connections and GBM’s relationship with Flyer has allowed them to respond quickly to this exiting new opportunity in the Mexican market.

“We have embraced the vision of electronic trading in order to provide the very best execution for our increasingly sophisticated clients,” said Enrique Rojas, Director of International Business Development at GBM in Mexico City. “We adopted FIX Flyer’s solution two years ago, and because of their solid reliability and superb performance we have been able to aggressively expand our algorithmic and low-latency trading programs for the direct benefit of our institutional clients around the globe.”

GBM chose FIX Flyer for the core FIX components since the solution is easy to support, scalable, and high-performance. In addition, GBM needed to ensure that the solution would give all of their client’s comfort that they can handle the potential of a dynamic and quickly emerging marketplace. Because of Flyer’s unmatched proficiency and experience as an overall FIX solution, GBM realized early in their evaluation process that Flyer extended their support and tools beyond the other conventional solutions. FIX Flyer works in some of the most demanding trading environments in the world, and that experience makes the product valuable to customers like GBM.

Source: A-TEAM 10.08.2010

Filed under: BMV - Mexico, FIX Connectivity, Latin America, Mexico, Trading Technology, , , , , , , , , , , , ,

Mexico to Follow US Expectations – August 2010- IXE BANIF – Monthly Analysis

Indications of a slowdown in US growth

Expectations of pick-up in the US economy for 2010 have cooled down recently. The most recent statements of the FED’s President suggested that a recovery in the US will happen only in the medium or long-term. This is a worsening of an already declining expectation for the US economy that started in June, and that we did not incorporate into our scenario at the time.

Until June, nearly everyone’s attention was concentrated on the Euro zone, with fears for the bankruptcy of local banks. These fears faded as the results of a stress test made with a sample of banks showed that very few names were in trouble. The spotlight then turned to the stronger indications of a weakness in the US economy.

Mexico – Monthly Allocation – August 2010

Mexico likely to adapt to new scenario

The Mexican economy continues to depend on its neighbor for exports, as it accounts for most of the demand for its products. With the growing expectation of a reduction in US growth, we believe that the local Mexican economy will tend to migrate from a manufacturing profile (based on exports) to a consumption profile (based on local demand).

While we believe that slower growth of the US economy is not good, we believe that the pace reduction observed so far is still consistent with our current and unchanged expectation for Mexican 2010 GDP growth of 4.4%. We believe that we were in the lower end of the market range, and now believe that others will adjust their expectations downward. In this way, we should move closer to the upper limit of the range of expectations. One indicator on the local economy that we highlight is internal wholesales, which we believe reached its peak at 7% in June (YoY growth, 6.9% in May) and is likely to slow down during the rest of the year. We expect internal wholesales to reach 3.9% for the entire 2010, taking into consideration the negative figures of the first two months of the year. Internal retail sales are now following the wholesales’ trend as an indication that retail companies are reducing inventories. We also expect July figures, when announced, to indicate a reversion of the local deflation observed in the April-June period.

For August, we have added Geo and Chedraui to our suggested portfolio and have withdrawn Asur, Autlan and Urbi.

Filed under: Banking, BMV - Mexico, Exchanges, Latin America, Mexico, News, , , , , , , , , , , , ,