All Professional Forex industry participants like, hedge funds, retail brokers, proprietary trading houses and money managers aggregate multiple single bank and non-banks market made feeds to achieve the tightest spreads possible into a BBO (best bid/offer) liquidity pool. Our team is delivering a platform that makes it easy and straight forward, for any Retail Trader and Investor to create and manage their own bespoke liquidity pool, by connecting, aggregating and managing their trading with multiple FX and CFD Brokers.
FX market participants are divided into 2 groups Takers and Makers
Traders/investors, retail brokers, hedge funds, money managers etc who are usually who are looking to buy/sell (to be in and out of their FX positions) as quickly and as accurately as possible are “take liquidity” out of the FX liquidity pool and are called “takers”. Majority of the market participants including all individual traders and investors and also the brokers they use to trade FX are Takers. They are also called ‘buy side’ clients as they ‘buy’ and use the liquidity.
On the other side there are Individual LPs (Liquidity Providers) usually top15 tier 1 banks like (Deutsche, Citi, JPM, UBS, HSBC, CS, RBS, RBC, BAML, Nomura, etc but also non-bank LPs who specialize in risk taking and liquidity provision, also very often operate as hedge funds and actively making prices and competing for the trade flow from the “takers”, by “making” prices into the liquidity pools, and various technology venues, ECNs and multi-deal platforms. These are usually also called “market makers” or only Makers. They are the “sell side” as they are the ones who are ‘selling’ the liquidity on the marketplace.
Both Takers and Makers are essential for a single BBO liquidity pool to operate efficiently.