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What currencies are supported for Local Currency Trading API?

Local Currency Trading (LCT) API at launch will accept the following currencies:

GBP: British Pound Sterling
CHF: Swiss Franc
EUR: Euro
CAD: Canadian Dollar
JPY: Japanese Yen
TRY: Turkish Lira
AUD: Australian Dollar
CZK: Czech Koruna
SEK: Swedish Krona
DKK: Danish Krone
SGD: Singapore Dollar
HKD: Hong Kong Dollar
HUF: Hungarian Forint
NZD: New Zealand Dollar
NOK: Norwegian Krone
PLN: Poland Złoty

What do I need to do to onboard as a LCT partner?

Please reach out to your Alpaca Sales Team Representative and request a Local Currency Trading Sandbox environment. Please specify the currency and account type you will be utilizing so that the most appropriate environment for your needs is established.

How do I create an account under LCT?

There are two ways to create a Local Currency account: Fully Disclosed or Omnibus Non-Disclosed. Both JIT Cash and Fully Funded Variations are possible.

How do I Fund accounts under LCT?

Accounts can be funded for LCT by either:

Bank Wire or;
Just in Time Cash or;
Just In Time

Does Local Currency Trading API support JIT?

Yes, Just in Time (JIT) supports Local Currency Trading. JIT Payments can be made in supported currencies to Alpaca, simplifying your operational requirements.

How does the Journals feature work?

Journaling in LCT is almost exactly the same as our regular Journals API. The main difference is the specification of “TRY” in the new “currency” field.

Example: Journal in Turkish Lira

Here is the request

{
  "to_account": "44394ea3-d5bf-4dc7-a39a-155aedcb1fd8",
  "from_account": "ece23fa8-0319-4ee5-9d54-f0d55841084c",
  "entry_type": "JNLC",
  "amount": "15",
  "currency": "TRY",
  "description": "journaling 10"
}

Request

Response: Journal in Turkish Lira

Here is the Response Body. Note here, the “currency” field denoting Turkish Lira, as shown by the three-letter currency code.

{
    "id": "3b1c71da-f9b4-4b4d-b8ee-96adfc8acb47",
    "entry_type": "JNLC",
    "from_account": "ece23fa8-0319-4ee5-9d54-f0d55841084c",
    "to_account": "44394ea3-d5bf-4dc7-a39a-155aedcb1fd8",
    "symbol": "",
    "qty": null,
    "price": "0",
    "status": "queued",
    "settle_date": null,
    "system_date": null,
    "net_amount": "15",
    "description": "journaling 10",
    "currency": "TRY"
}

Response

Response - SSE for Turkish Lira Journal

Here is what the SSE looks like for this type of action. Notice here, it is the same as any other journal event from an SSE perspective.

data: {
    "at":"2022-08-11T17:06:23.287209Z",
    "entry_type":"JNLC",
    "event_id":10895115,
    "journal_id":"3b1c71da-f9b4-4b4d-b8ee-96adfc8acb47",
    "status_from":"",
    "status_to":"queued"
}

data: {
    "at":"2022-08-11T17:06:47.155302Z",
    "entry_type":"JNLC",
    "event_id":10895118,
    "journal_id":"3b1c71da-f9b4-4b4d-b8ee-96adfc8acb47",
    "status_from":"queued",
    "status_to":"sent_to_clearing"
}

data: {
    "at":"2022-08-11T17:06:50.209109Z",
    "entry_type":"JNLC",
    "event_id":10895119,
    "journal_id":"3b1c71da-f9b4-4b4d-b8ee-96adfc8acb47",
    "status_from":"sent_to_clearing",
    "status_to":"executed"
}

How does corporate action work with LCT?

On the day before the dividend payment is made, Alpaca will use the 23:30 ET exchange rate, which will apply to all payments made the following day related to the local currency. The same logic will apply to other Corporate Actions.

Note: there is no additional markup applied to Dividends or other Corporate Actions.

What is the difference in API?

The main difference between LCT and non-LCT is the usage of a “swap_bps” field that is added to all orders. In this area, the correspondent can specify, at the order level, how much they wish to charge the client from their side. Note that Alpaca has a set swap_bps that is set at the correspondent level, and this cannot be controlled by the correspondent.

How revenues are generated?

Revenues are generated by an FX Fee, or swap fee that is applied to each trade. This is added as basis points or bps for short. Please note, that 100 basis points is equivalent to 1%. For example - a JPY 10,000 trade with a 50bps fee would pay JPY50 in swap fees.

How fees are booked?

There are two sets of fees that are booked: the first is the correspondent fee which can be adjusted at the order level to meet your product requirements. The second is a fixed Alpaca fee that is charged regardless of what the correspondent fee is.

Who is eligible, and what type of partner setup or status can do LCT?

All partners are eligible to utilize LCT and participate in the revenue-sharing facility offered from the FX markup. At this time, we do not support Crypto for Local Currency Trading.

How currency exchange (FX) works? Who is taking the FX risks?

Conversion from Local Currency to USD is taken by Alpaca, along with the associated FX risk. Whether you are a JIT or Pre-Funded customer, you will be sending funds to one of Alpaca’s Local Currency accounts. From there, it is converted to US Dollars to meet trading obligations with our clearing partners to cover trades. The timing and frequency of FX booking and hedging is determined by Alpaca’s risk and operations team, which will vary subject to market conditions. As long as partners provide the required funds for settlement at the requested time, there is no FX risk for the partner.

To learn more on how to get started with Local Currency Trading, please check out our learn article and documentation here.

The content is for general information only and is believed to be accurate and reliable as of posting date but may be subject to change. Alpaca Securities LLC does not recommend any specific investments or investment strategies. Alpaca Securities LLC does not provide investment, tax, or legal advice.

Securities brokerage services are provided by Alpaca Securities LLC ("Alpaca Securities"), member FINRA/SIPC, a wholly-owned subsidiary of AlpacaDB, Inc. Technology and services are offered by AlpacaDB, Inc.

This is not an offer, solicitation of an offer, or advice to buy or sell securities, or open a brokerage account in any jurisdiction where Alpaca Securities LLC is not registered or licensed, as applicable.

Disclosures

Brokerage services are provided by Alpaca Securities, member FINRA / SIPC, a wholly-owned subsidiary of AlpacaDB, Inc.

Technology and services are offered by AlpacaDB, Inc.

Brokerage services are provided to customers who can write automated investment code and self-direct their own investments. Alpaca brokerage services are only provided to customers who agree to electronically sign agreements and agree to receive messages, confirmations, and statements electronically. Is Alpaca right for me?

This is not an offer, solicitation of an offer, or advice to buy or sell securities or cryptocurrencies, or open a brokerage account or cryptocurrency account in any jurisdiction where Alpaca Securities or Alpaca Crypto respectively, are not registered or licensed, as applicable.

The Paper Trading API is offered by AlpacaDB, Inc. and does not require real money or permit a user to transact in real securities in the market. Providing use of the Paper Trading API is not an offer or solicitation to buy or sell securities, securities derivative or futures products of any kind, or any type of trading or investment advice, recommendation or strategy, given or in any manner endorsed by AlpacaDB, Inc. or any AlpacaDB, Inc. affiliate and the information made available through the Paper Trading API is not an offer or solicitation of any kind in any jurisdiction where AlpacaDB, Inc. or any AlpacaDB, Inc. affiliate (collectively, "Alpaca") is not authorized to do business.

You should know that the use or granting of any third party access to your account information or place transactions in your account at your direction is solely at your risk. Alpaca does not warrant against loss of use or any direct, indirect or consequential damages or losses to you caused by your assent, expressed or implied, to a third party accessing your account or information, including access provided through any other third party apps, systems, or sites.

Market prices, data and other information available through Alpaca are not warranted as to completeness or accuracy and are subject to change without notice.System response and account access times may vary due to a variety of factors, including trading volumes, market conditions, system performance, and other factors.A more complete description of the impact these factors may have can be found in our risks of automated trading systems section.

All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk it does not assure a profit, or protect against loss, in a down market. There is always the potential of losing money when you invest in securities, or other financial products. Investors should consider their investment objectives and risks carefully before investing.

There are risks unique to automated trading algorithms that you should know about and plan for. You should setup a method or system of continuous monitoring or alerting to let you know if there is a mechanical failure, such as connectivity issues, power loss, a computer crash, or system quirk. You should also monitor for instances where your automated trading system experiences anomalies that could result in errant, missing, or duplicated orders. A more complete description of these and other risks can be found in our FAQ section.

Conditional orders may have increased risk as a result of their reliance on trigger processing, market data, and other internal and external systems. Such orders are not sent to the market until specified conditions are met. During that time, issues such as system outages with downstream technologies or third parties may occur. Conditional orders triggering near the market close may fail to execute that day. Furthermore, our executing partner may impose controls on conditional orders to limit erroneous trades triggering downstream orders. Alpaca Securities may not always be made aware of such changes to external controls immediately, which may lead to some conditional orders not being executed. As such, it is important to monitor conditional orders for reasonability. Conditional orders are “Not Held” orders whose execution instructions are on a best efforts basis upon being triggered. Furthermore, conditional orders may be subject to the increased risks of stop orders and market orders outlined above. Given the increased potential risk of using conditional orders, the client agrees that Alpaca Securities cannot be held responsible for losses, damages, or missed opportunity costs associated with market data problems, systems issues, and user error, among other factors. By using conditional orders the client understands and accepts the risks outlined above. Alpaca Securities encourages leveraging the use of Paper accounts to become more comfortable with the intricacies associated with these orders.

ETFs can entail risks similar to direct stock ownership, including market, sector, or industry risks. Some ETFs may involve international risk, currency risk, commodity risk, and interest rate risk. Trading prices may not reflect the net asset value of the underlying securities.

All accounts are opened as limited purpose margin accounts. You should know that margin trading involves interest charges and risks, including the potential to lose more than deposited or the need to deposit additional collateral in a falling market. Before using margin, customers must determine whether this type of trading strategy is right for them given their specific investment objectives, experience, risk tolerance, and financial situation. For more information please see Alpaca's Margin Disclosure Statement and Margin Agreement. These disclosures contain information on Alpaca Securities's lending policies, interest charges, and the risks associated with margin accounts.

Commission-Free trading means that there are no commission charges for Alpaca Securities self-directed individual brokerage accounts that trade U.S. listed securities through an API. Relevant regulatory fees may apply.

Commission free trading is available for Alpaca's retail customers. Alpaca reserves the right to charge additional fees if it is determined that orders flow is non-retail in nature.

Cryptocurrency is highly speculative in nature, involves a high degree of risks, such as volatile market price swings, market manipulation, flash crashes, and cybersecurity risks. Cryptocurrency is not regulated or is lightly regulated in most countries. Cryptocurrency trading can lead to large, immediate and permanent loss of financial value. You should have appropriate knowledge and experience before engaging in cryptocurrency trading. For additional information please click here.

Cryptocurrency services are made available by Alpaca Crypto, a FinCEN registered money services business (NMLS # 2160858), and a wholly-owned subsidiary of AlpacaDB, Inc. Alpaca Crypto is not a member of SIPC or FINRA. Cryptocurrencies are not stocks and your cryptocurrency investments are not protected by either FDIC or SIPC. Please see the Disclosure Library for more information.