OTC trading platform of the year: Reactive Markets

Risk Awards 2026: Through April tumult, Reactive kept fill rates near 100% and latency below 50 microseconds

Left to right: Gruff Bryan, Charlie Patten, Phil Morris, Henry Durrant, Billy Hutton

Photo: Juno Snowdon

Anyone unfamiliar with markets might think it obvious that venues should offer sophisticated traders technology that is fast, reliable and cost-effective.

That isn’t always the case. Liquidity-takers and -makers tell Risk.net that incumbent platforms can be slow and untransparent. In many cases, they are beholden to vested interests.

Reactive Markets adheres to simple principles that mean its kit can be trusted to deliver on time and in budget. Phil Morris, CEO and co-founder of the six-year-old firm, says many of the challenges faced by rival platforms are “engineering problems” that Reactive has now solved.

Morris, who previously worked at non-bank market-maker Voltaire Capital as chief technology officer – as well as in similar roles at Deutsche Bank and RBS – knows about the pain points in high-speed trading.

At Voltaire, Morris says he found the technical customer service of incumbent platforms lacking: “We constantly had issues with perceived latency, and we found that these platforms were essentially a black box, and there was no transparency as to what was happening within that platform or the real performance that they had. And they were all quite frankly very expensive to use and to trade on.”

Reactive’s commercial model is free to the taker. The firm publishes a flat transaction fee model for the liquidity provider (LP) that clients say is among the very lowest in the space.

If you want to build something that is very fast, efficient and scalable, it’s difficult to do if you don’t own your own tech stack

Phil Morris, Reactive

Starting in foreign exchange, Reactive set out to build a new generation of platforms giving market-makers the flexibility to distribute liquidity to all of their clients as if they were connecting directly. For the buy side, the offering would promise access to a low-latency network where they would get better execution, better pricing, and all at a lower cost.

Reactive does not limit price updates available from LPs, or the number of sessions through which they can segment their flow. LPs say Reactive does not overtly monetise pricing sessions or connectivity, meaning it is more cost-effective to provide dedicated pricing feeds to buy-siders.

An executive at a non-bank market-maker says some of Reactive’s rivals were built up to 15 years ago, and lack scalability. They can’t handle today’s level of market data updates “without incurring latencies, without dropping trade requests on the floor”, the executive says: “With some platforms, clients think we’re rejecting 10% of their trades – when, in reality, we think we’re filling 100% of the orders that are sent to us.”

Reactive says its fill ratio remained above 99.8% across the service every month of this year, including the most volatile periods such as the US’s ‘Liberation Day’, when the average number of price updates for a single LP in Eurodollars, for example, spiked from four or five a second to nearly 400.

Reactive also differentiates itself by the transparency with which it measures latency. The firm prints latency measurements from the very edge of its networks to give the truest figure.

During busy periods such as April, Reactive says it saw no degradation of service, with sustained data rates of over 10 to 15 times what they normally would be, while keeping latency below 50 microseconds. “We regularly process in excess of 5 billion quotes a day, maintaining both average and outlier end-to-end latency,” says Morris.

Unlike some other venues, Reactive owns its full tech stack. “That results in lower latencies,” says a trading head at a large hedge fund. “And they’re a little bit more dynamic in how they can adjust the functionality for clients.”

“If you want to build something that is very fast, efficient and scalable, it’s difficult to do if you don’t own your own tech stack,” says Morris.

Core FX focus

Reactive is live for spot foreign exchange, forwards, non-deliverable forwards (NDFs) and FX swaps via streaming, request-for-quote (RFQ) and algos.

Morris says FX volumes have doubled every year for the past four years, with overall platform volumes consistently in an average daily range of $30 billion to $40 billion. About 75% of volumes are streaming and 25% RFQ. Spot volume accounts for around 70% overall. NDFs and forwards combine to make up around 15%, and swaps/NDF swaps represent the remaining 15%. Over 20 liquidity providers can stream NDFs and forwards.

On the FX side, there are 64 takers of liquidity and 35 LPs on the network, including every tier one bank and many regional specialists from Asia, Latin America and Scandinavia. All large non-bank market-makers – such as Jane Street, Tower and XTX – are present.

Eight of the largest 20 global hedge funds are live on the platform for FX, up from just two a year ago.

Flexibility

Reactive has positioned itself to benefit from a trend for many hedge funds to move away from using aggregators and instead to connect directly to LPs.

Henry Durrant, Reactive’s chief revenue officer, says quant firms in particular have struggled to get the performance and flexibility they require through aggregators or third parties: “They were building, managing and maintaining up to 30 API [application programming interface] connections, and upgrading them whenever the banks upgraded their APIs. And that just put a huge cost on running that business.” APIs are effectively the bridges that connect applications.

Durrant feels Reactive has a strong product to take business off both incumbent multi-dealer platforms on the manual trading side, as well as API-focused aggregators.

“If you look at all of our peers or competitors, they either fit into the category of servicing API clients or manual trading clients,” says Durrant. “We are the only platform that really competes for both API clients and GUI clients in FX.” GUI clients are those trading manually through Reactive’s portal.

The head of eFX trading at a large European bank says Reactive has poached clients from platforms such as FXSpotStream and FXall due to a “technology stack that is second to none”. The market data that Reactive is able to share with LPs is strong, the trading head adds.

Those analytics provide clients with granular detail on the pricing quality of their LPs, says Durrant. “For example, what percentage of time is a given LP top of book in dollar-yen? How does that differ throughout the trading session? Are they tighter in Asia hours versus London hours versus New York hours?”

Clients also say Reactive operates free from the influence of any powerful groups working to protect their own interests. At some bank-owned consortiums, non-bank market-makers are shut out, for example, while Reactive opens its doors to all.

Dealer-to-dealer

Not being bank-owned also means Reactive has the potential to upset the traditional intermediation model, by facilitating banks interacting with each other directly, such as by offsetting FX risk with peers.

Its Crossrate product is a dealer-to-dealer service that allows the exchange of risk between banks at a mid-price implied by their crossed bid-offers. There are now nine banks on the network. Reactive stresses that its offering of a cleaner way to interact with other participants in the market shouldn’t be interpreted as the firm competing directly with inter-dealer brokers.

We are the only platform that really competes for both API clients and GUI clients in FX

Henry Durrant, Reactive

The head of eFX trading at the large European bank says Crossrate looks to replace the mid books of FXSpotStream and BGC, and is attractive because it allows his bank to have conversations with a counterparty it is matching off with that otherwise would be impossible.

“If you’re on BGC or FSS Mid, if the mark-outs look a certain way, there’s nothing you can do, or contact the counterparty with, and sort it out,” says the head of eFX trading. “Here, you build relationships with your tier one counterparts, and you go: ‘Look, we’re all looking to do the same thing, offset risk without too much impact – and on our side, it looks like this.’ And then you kind of work things out and make it work.

“And that’s not been possible up until now. I don’t want to go to JP and give them a two-way price. They can read our skew and everything. With this solution, I can because the price itself doesn’t leave Reactive Markets.”

Bilateral equities

Reactive’s long-term vision is to take its offering in a more cross-asset direction, a strategy it has started realising by building out the backbone of bilateral trading for equities, for market participants and professional investors.

While FX accounts for 85% of firm revenue, equity comprises 15%, based on around $1 billion a day of order volume.

The move into cash equities takes advantage of a market structure shift away from on-exchange, agency model trading by sell-side brokers on behalf of the buy side. Instead, principal non-bank liquidity providers – such as Citadel Securities, Jane Street and XTX – can now interact bilaterally with buy-side clients. Reactive connects the two sides with bilateral price streaming, a competence that existing equities technology providers have never needed to handle.

An executive at a non-bank market-maker says: “You’re seeing the market move towards a much more FX-like market structure where business is coming away from the primaries. But very little of the technology is designed to cope with the amount of market data. Reactive can handle that quite natively.”

Agency execution specialist Liquidnet has partnered with Reactive to use its platform as the bridge between Liquidnet systems and market-makers, using Reactive Markets’ streaming technology to cope with very low-latency data from market-makers.

Gareth Exton, Liquidnet’s head of execution and quantitative services for Europe, the Middle East and Africa, says: “The benefits to Liquidnet has been speed to market and efficiency in terms of cost. In addition, working with Reactive Markets has future-proofed the solution we provide to Liquidnet members, as they can use a single platform to trade with multiple market-makers and new liquidity sources as the market evolves.”

Editing by Rob Mannix