FOCUS : DMA - an increasingly attractive toolset for the FX buy-side

First Published in e-Forex Magazine January 2010

Nicholas Pratt

Nicholas Pratt

The concept of 'Direct Market Access' (DMA) is a simple one and is yet another example of an invention that started out in the equities market and is now being adopted in the FX market. Nicholas Pratt examines the evolution of DMA and what it means for FX traders


In equities DMA emerged over the last decade as a way of providing buy-side firms with an undiluted means of access to the exchanges and other execution venues. Up till this point the only way that an asset manager, hedge fund or corporate could access the market was via a broker. However as electronic trading began to thrive, leading to more advanced strategies such as algorithmic trading and facilitating the growth of high frequency trading hedge funds, the conventional broker-based means of execution began to feel insufficient to these new breed of buy-side traders.

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