GSA Complains About High-Frequency Currency Penalty

Jan 23 2013 | 12:14pm ET

Hedge fund GSA Capital Partners is none too pleased with a currency-trading platform it uses.

The London-based firm has stopped posting passive orders on Thomson Reuters' Reuters Matching platform, protesting what it said was a slap on the wrist for another user of the system. The skirmish boils down to another battle over high-frequency trading; GSA and other currency traders worry that high-frequency users are abusing the platform, and the hedge fund lays the blame squarely at Thomson Reuters' feet.

At issue is Thomson Reuters' brief suspension of Lucid Markets late last year. Lucid used multiple servers to get trading data ahead of competitors, which is against the rules, according to Thomson Reuters. Lucid said it broke no rules.

Either way, GSA isn't happy. "Thomson Reuters's failure to sanction the offender publicly has damaged confidence in the platform and in Thomson Reuters's ability to provide a level playing field for all participants," GSA said.

The fight puts Thomson Reuters in a tough place: between two of its biggest customers. GSA traded a notional US$15 trillion in currencies in 2011, The Wall Street Journal reports, while Lucid traded US$13.4 trillion that year.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...