COVID-19 disruption and record levels of market volatility provide a serious test of FX trading business continuity plans (BCP). A Refinitiv survey of more than 400 clients provides insight into how FX market participants are coping with the ongoing disruption.

Volatility in FX over the past few weeks has resulted in many platforms publishing record volumes. As an example, Refinitiv saw spot matching exceed US$ 100 billion in a day. Combined with trading firms operating under business continuity plans, the Refinitiv survey provides a snap-shot of how the market is managing activities during the current disruption.

The survey found the following.

Working From Where?

The majority of respondents said that their preference was for their staff to either work from home or from BCP locations which were already identified and tested.

The breakdown was –

• Working from Home = 59%
• Working from BCP = 20%
• Split between sites = 12%
• No action = 4%
• Key activities moved to unaffected locations = 2%

Client Segment Split

In EMEA, nearly 80 percent of bank employees are splitting between BCP locations/office and working from home, which highlights the sell-side's dependency on trading desks and trading floors.

• Banks – 19% WFH & 79% Staff Split between sites
• Brokers = 100% Staff Split
• Hedge Funds = 100% WFH
• Corporates = 100% WFH
• Asset Managers = 66% WFH & 34% Staff Split

System Access

Using a company VPN is the most common method of connecting to systems, with 79% of respondents using this service. Another 10% of people said they were using systems from an alternative company location.

Technical Readiness

The good news is that 76% were all prepared and tested. 17% had plans but had not tested them and only 7% had no technology BCP.