Deutsche Börse has acquired a stake in currency options platform Digital Vega
Part of Deutsche Börse’s strategic objective to extend its positioning in off-exchange market segments/ Digital Vega software provides pre-trade price transparency in foreign exchange (FX) options for institutional investors, corporates and other FX market participants
Deutsche Börse AG today announced that it has acquired a minority stake in Digital Vega, a London based company, which provides electronic FX technology solutions to buy- and sell-side firms. Digital Vega has developed a unique software solution, which broadcasts request for quotes (RFQ) from buy-side asset managers, corporates, hedge funds and regional banks for FX option transactions to sell-side liquidity providers. The service is supported by seven of the largest FX banks, with a further five banks looking to provide pricing services in the near future.
With this acquisition, Deutsche Börse is increasing its positioning in the provision of pre-trade price transparency in the derivatives area for institutional investors and taking an initial footprint in the FX derivatives space. An investment agreement was signed last week, whereby Deutsche Börse will pay a US dollar amount in the single digit million range.
“This investment in Digital Vega highlights our recognition of the changing industry landscape and aims to support the G20 commitments for improving the integrity and safety of the OTC markets. As a regulated exchange and clearinghouse we provide transparent trading, processing and clearing services. The software and processes provided by Digital Vega are an important element to achieve the regulator’s goal of higher transparency,” said Peter Reitz, Managing Director of Deutsche Börse and member of the Eurex Executive Board.
“We are immensely pleased to announce this investment from such strategically important partners and view this as a clear endorsement of our vision and business model. By leveraging our collective strengths, and working with our buy- and sell-side supporters, we intend to establish Digital Vega as one of the most significant participants in the increasingly changing FX environment,” said Mark Suter, CEO of Digital Vega.
Digital Vega’s software streamlines the trading process by facilitating electronic transmission and receipt of tradable competing quotes, thereby enhancing price transparency and execution for over-the-counter/bilaterally settled FX option transactions. Digital Vega assists buy-side firms and corporates in demonstrating best execution, which enables MiFID compliance. In addition, FX options were not made exempt from the latest Dodd/Frank Act amendments
About Digital Vega
Digital Vega has worked with a wide range of market participants to deliver an automated, end-to-end solution for FX Option trading, encompassing real-time pricing, execution, confirmation, reporting, and straight-through-processing; bringing together liquidity providers and consumers in a single dedicated venue, which has been designed to improve both transparency and liquidity.
About Deutsche Börse
Deutsche Börse Group is one of the world’s leading service providers for the securities industry with a product and service offering for issuers, investors, intermediaries and data vendors. The Group covers the entire process chain from trading, through clearing, to settlement and securities custody. Furthermore, Deutsche Börse offers market data, indices and analyses and is a service provider for the development and operation of IT systems.
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