Currency Exchange

This article will describe how to make a currency exchange in the back office interface. To be able to make an exchange order, there must be an Execution Interface for Currency Exchange.

In this example, the customer has an account in the Swedish currency SEK and would like to make a currency exchange into USD.

1. Create Currency Exchange order

2. Create Batch orders

3. Send Batch order

4. Execute and Fill

5. Reset Batch order

1. Create Currency Exchange order

In the action menu at the account click on Currency Exchange to create a currency exchange order.

Open

A pop-up ticket will appear where we can select which currency we want to exchange. 

From Currency: The currency that is present in the account and that should be sold.
To Currency: What currency the customer would like to buy.

After the currency has been selected additional fields will appear. 

Open

Execution Interface (EI): The execution Interface of the type currency exchange will be available in the dropdown menu. The execution interface is the trade route.
The selected Execution Interface will default to the default EI that is set for the currency. In systems data we need to set a default execution interface (trade route) for each currency that should be tradeable in the system.

Direction:

In this example, we will place an order to exchange 1,000 SEK to USD. An order has been placed and an order reservation is created. The next step is to create batch orders.

2. Create batch orders

The back office handles orders by creating a batch order from all the currency exchange orders that have been placed during, for example, one day.

Go to the menu Orders > Exchanges 

There is always possible to cancel the order. Click on the action menu and choose Cancel Order.

Click the action menu to Create Batch Orders.

A pop-up ticket will appear (Create Batch Orders). In the dropdown menu are all execution interfaces that have the type currency exchange. If we confirm without choosing anything in the dropdown menu, batch orders will be created for ALL execution interfaces (trade routes). When choosing a specific execution interface, batch orders will be created that has the specific EI. 

Batch orders are created from the following three criteria:

• Execution interface

• Currency pair

• Direction (Buy or Sell)  

Confirm by clicking the Confirm button

The order has now been processed and a batch order has been created. The next step is to send the batch order.  

3. Send Batch order

Go to the tab Batch Orders (Orders > Exchanges) 

We can either send one batch order or select several. Within the back office interface, there is always the possibility to cancel the batch and client orders or just the batch. 

There is also a filter option called Order Route where the back office administrators can filter on order route, which means that they can find orders based on order routes and manage them as a group.. 

When clicking send a pop-up ticket will appear. Click Confirm to Send the order. 

The next step of the process is to conduct the actual trade. This is made manually outside BFS or through an automated connection to a broker or marketplace.

Once the trade is filled we can proceed with entering the execution into BFS.

4. Execute and Fill 

Go to the tab Batch Orders (Orders > Exchanges) 

Click on the action menu to Execute the order. 

A pop up ticket will appear. Trade date is set to the execution date according to the received fill details.

Enter the amount in the field, To Amount (Sell) or From Amount (Buy), depending on the order route. 

Account information is collected from the execution interface. There is a possibility to change the information by clicking on the Choose button. 

When clicking Confirm transactions will be created on all relevant accounts. 

The batch order is Executed and can be settled

Go to the tab Batch Orders (Orders > Exchanges) 

Click the action menu to Settle the order. 

A pop up ticket will appear. When settling a currency exchange we use both settlement date and value date.

 It is possible to set different dates at the settlement date and value date. Click (plus sign) to expand the ticket to enter different dates for the currencies. Click Confirm to settle the order. When we have chosen to confirm transactions will be created in the settlement dimension. 

If we choose to select more than one batch order to settle, by clicking the action menu and click Settle Selected, we will not be able to choose different dates, because the batches might not have the same currency pairs. Click Confirm to settle the orders. 

It is not possible to settle several batch orders that don't share the same status. A pop-up message will appear. 

The currency exchange is finished when settlement is made and it´s now possible to buy instruments in another currency. 

5. Reset batch order

There is a possibility to reset the batch order and correct transactions, for example, if we selected an incorrect date or exchange rate when executing the order. 

In the action menu choose Correct Transactions. 

A pop up ticket will appear. Click Confirm to correct the transactions. 

The batch order will get status Review (marked red) and it´s possible to choose the alternatives: Reset, Cancel Batch and Client Orders or Cancel Batch. 

Click the action menu to choose an appropriate alternative. 

When choosing Reset the order will get status Created and we can process it again. 

Cancel Batch and Client orders: Cancels both the batch orders and the individual orders. 

Cancel Batch: The batch order is canceled but the individual/client orders will remain.