What is trading via FIX API, and what makes it so popular?

Source: LeapRate 2020-05-28

FIX (Financial Information Exchange) API (application programming interface) is a highly scalable electronic communication protocol to facilitate the real-time exchange of information related to financial markets. It has become the de facto standard method of pre-trade, trade and post-trade communication. Market participants including banks, hedge funds, prime brokers and “prime of primes” utilize FIX for their own trading needs or to connect directly to clients.

To give you an indication as to how popular FIX is: the FIX Trader Community (https://www.fixtradingcommunity.org/) has around 110,000 registered members and 275 corporate members (including Goldman Sachs, Barclays, Morgan Stanley and so on).

What makes FIX protocol so popular?

· It is Global and Standard

· It works for any asset class, including FX, Metals, and CFDs and it is highly scalable

· It is free

In the world of FX, the FIX API is offered by sophisticated retail brokerages and “prime of primes”, especially to high volume clients. Interested parties are normally provided with a list of technical specifications to help guide them in connecting to the protocol and any Java developer should be able to establish a FIX connection relatively quickly. After an initial period of testing, the client may enter the LIVE FIX API environment.

Why, and when, would someone want to utilize the FIX API method of connectivity?

· You are developing or, already have your own trading platform with an open API

· You prefer a separate and more secure connection (using Dedicated Fiber line or cross-connects

· You already have your own MT4 Bridge

· You want to manage and support all the elements of the trade life cycle

· You require a customized setup of the connection (used by algorithmic, black box and quantitative FX traders)

How one can use LIVE Pricing via FIX API for purposes other than trading?

If you are a developer or technology provider, you can use Live Pricing via FIX for new platform development and testing:

As a trader, you can use it to analyze current market conditions,

If you are a news provider, you can use FIX connectivity to provide a live market price feed to your website,

As a “Market Maker” broker, you can utilize Live Pricing via FIX to stream Depth of Market information to your systems or to embed real-time information within your risk management software.

Sophisticated Brokers or Prime of Primes (PoP) will not only provide FIX API credentials but will also give access to a full suite of Back Office software and a choice of trading platform desktop applications.

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What is trading via FIX API, and what makes it so popular?

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