Meet the Team - James Hull, COO

1. Tell us a bit about yourself, your role and why you like working in the FX space?

I’ve been working in FX for a vast majority of my career, mostly within operational roles on both the buy side and sell side.  Whether supporting large corporates and asset managers with their hedging and alpha generation mandates, or helping clients where FX is a second order requirement to primary activities within the securities and/or Fixed Income markets for example.  I think the fact that FX has an important place across many asset classes within the financial markets along with its’ impact on our day-to-day life, makes FX an interesting arena to operate within.  The goal (and the exciting part) for everyone at MillTechFX is to help clients leverage from our strong FX background to access a competitive, transparent and easy to use solution for clients both familiar and less familiar with the FX markets.

2. What, from your perspective/your role as [ COO ], is the biggest challenge in the FX space right now?

In my view there are four core issues for many participants in the FX markets:

• High Costs, especially for corporates and institutions who can’t directly access to the wholesale FX market
• Slow speed, especially in the context of correspondent banking inefficiencies and payment friction
• Lack of Transparency, despite the liquidity available in FX within the OTC market.
• Minimal Automation, execution and operational processes are still mostly manual when it comes to client onboarding, KYC & AML screening, pre-execution checking, execution, post-execution settlement and reporting.

At MillTechFX we have worked hard to address each of these challenges with the aim of remaining agile to benefit from any future enhancements that can benefit us and our clients.

3. If anything was possible, what would you do to make FX execution smarter? 

FX execution has evolved such that it can be optimized to take into account both client specific requirements (such as currency pair, transaction size) and the prevalent market conditions (liquidity and volatility etc). In this space, we have already seen increasing number of FX algorithm adopting artificial intelligence and machine learning to deliver transparency, low cost and adaptive FX execution strategies.

I think the same logic can be applied to FX payments as well.  One area of high interest is the significant increase of domestic faster payment networks across the world, there are increasing efforts globally to efficiently link these local payment networks to provide a cross border payment solution. Building a smart payments network becomes a process of selecting the optimal payment rails to route the FX payments in the most cost and time efficient way.

Two projects currently under testing by BIS (Bank for International Settlement) that MillTechFX are following are;

• Project Nexus: Project Nexus will allow countries to link real-time national payment systems with minimal adaptations.
• Project Dunbar: testing Central Bank Digital Currency (CBDC) from a cross border perspective.

4. What is the most important trend in the FX space right now?

 I think it’s hard to overlook Transparency.  This is a common theme at meetings I have been attending with peers, clients and prospects for some time now.  I don’t think I have many conversations where the word ‘transparent’ fails to arise and it is an extremely important part of what we are trying to achieve as a group, not just in execution pricing, but in every aspect of what we do from the contracting and onboarding phases right the way through to operational support and customer services.  Obviously, quality of execution is critical to our service and clients and as a fiduciary, we have the distinct benefit of having the same common goals as our clients when it comes to proving this.  Our execution portal displays the prices of each of our Banks and will execute on the best price available, this combined with regular independently calculated Transparency Cost Analysis reports are 2 key elements that I think speak to the provision of transparency.

Another area we see an opportunity to support is within Corporate Treasuries, where perhaps FX makes up a portion of the market activity but is typically not integrated into Treasury Management Systems (TMS). As a result, often, FX execution is not managed in the same place as other corporate activities and/or is manually booked into the TMS.  MillTechFX offer TMS integration via API to provide seamless access to FX execution, allowing execution and trade/position management to sit alongside the other activities core to a corporate treasurers daily activity.