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What To Consider When Trading FX With FIX API?

Blog | 19 Feb 2021 05:00/PM GMT

For the past 10 years, trading forex using a Financial Information Exchange (FIX) Application Programming Interface (API) has been demanding due to circumstances such as control, speed, and security.  

FIX API is an electronic communications protocol for real-time information exchange and financial securities transactions.  

With the gradual formation of the electronic trading trend, FIX API has become one of the fastest and most secure ways to trade in the forex market.  

In fact, FIX API has enabled the major market participants such as banks, brokers, liquidity providers, and institutional traders to connect.  

They use it to transmit transaction information that contains two independent parts, which is liquidity display (quotes), and the transaction (behavior).  

Liquidity providers for example use FIX API to provide quotes for brokers or hedge funds.  

Example in point: Doo Clearing used FIX API as a way to connect directly with a particular Liquidity Provider or aggregator, and by chosen, or to an MT4 or MT5 bridge provider. 

Doo Clearing offers algorithmic and high-frequency traders in the best trading environment. Our technology and pricing solutions ensure that traders experience all the benefits of an aggregative, low latency trading environment.  

Furthermore, Doo Clearing enables direct access to consistent, reliable bank and non-bank price liquidity covering a wide range of instruments.  

However, before using FIX API, you need to consider some of the requirements:  

1) Test the detailed information of the connection environment before a real time connection.  

2) Provide the technical docking party (docking information) and the other party with a manual that can allow the programmer to integrate and connect based on the docking information. 

3) An experienced programmer with standard protocol skills (such as HTTP, Telnet, TCP or Java) is needed. This will help to establish a connection easily. 

4) Use a liquidity provider for cross-connection. This is due to many top banks and liquidity providers provide cross-connections in NY4 New York, LD4 London, and TY3 Tokyo data centers.  

Benefits of Using FIX API

  1. To set up a FIX API connection, it does not take a lot of time since the protocol is unified throughout the industry.
  2. Market participants can communicate in standardized languages.
  3. Allow a huge amount and high frequency of information to be transmitted in a short time.
  4. The overall speed execution is faster.
  5. Designed a personalized interface.
  6. Be able to use your own software and customize it according to the needs of traders.
  7. Use various order types.

Integrating a robust FIX API into the trading operations infrastructure is a widely sought-after way to improve market communications and enhance trade performance. 

 About Doo Clearing   

Doo Clearing is a UK-based spot forex and CFD liquidity provider that incorporates advanced and strategic clearing systems to provide qualified professional clients and financial institutions with unparalleled clearing services that connect the world’s top liquidity.   

Doo Clearing Limited is a legal entity registered in the UK and holds a regulatory licence issued by the UK Financial Conduct Authority (registration number 833414).   

To get started, contact Doo Clearing’s Specialist team today for an insightful preview of how we can bring your brokerage to the next level.   

London Office   

Email: [email protected]

Website: www.dooclearing.co.uk   

Hong Kong Office   

Email: [email protected]

Website: www.dooclearing.com