Again, I appreciate your attention to my questions.
Yes, do these 10+ liquidity providers pay FXCM materially for first access to the order flow over other willing liquidity providers? It is my opinion that your clients would receive more competitive pricing if your firm did not have such a practice and actually sourced liquidity from all willing providers.
Case in point: According to FXCM's website, your clients have to pay a time-weighted spread of approximately 1.5 pips on the EUR/USD. My group makes markets at venues where we are forced to compete with EUR/USD spreads of as low as 0.1 pips, because there is fair access and none of us are making payments for order flow. And yes, the orders are not tagged by unique client identifiers and we cannot see stops either.
Reading between the lines, am I right to understand that Lucid carries out internal crossings on a large portion of your institutional client (who could represent retirement and pension funds) order flow from FXCM Pro before sending them out to the broader, displayed markets?
Does FXCM or Lucid own Cognitive Data Dispatch LLC (to develop microwave networks) and Kinetic Global Markets Inc (to develop tools for textual news analysis)? What is V3 Markets's role in your ecosystem? How are such entities with significant technological advantages generating revenue responsibly while trading, or being used to trade, the same products as your institutional or retail clients?
I have nothing against FXCM specifically, and regardless of your responses to these questions, I feel that the answers should be available transparently if one is in the business of facilitating clients' trades. The heart of my proposal is that a broker, whether for institutional or retail clients, should work for his clients with no conflict of interest, and that such a practice warrants additional regulatory oversight.