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Concept Capital Markets – Best North American Prime Broker

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2014 was another encouraging year at Concept Capital Markets LLC, one of North America’s leading introducing brokers.

2014 was another encouraging year at Concept Capital Markets LLC, one of North America’s leading introducing brokers. According to managing member Jack Seibald (pictured), there were four key drivers of business growth:

1. The firm’s longstanding reputation as an effective partner/service provider to managers starting new investment businesses
2. The attraction to established fund managers of its comprehensive solutions for portfolio and risk reporting, and managed accounts, 
3. Further development of its outsourced trading solution, and 
4. Enhanced capital introduction efforts.

Last year, Concept Capital’s client assets in custody with its clearing firms increased 38 per cent through a combination of organic new client growth and the assumption of the IB businesses of two firms who were no longer in a position to effectively compete in the market. Its staff increased by more than 15 per cent, through a combination of the aforementioned takeovers and additional hiring. 

“Driven by the firm’s comprehensive offering, our sales team succeeded in winning numerous new clients, both new launches and established funds,” says Seibald. “Our aim is to set an appropriate expectation level with prospective clients and to make a positive impression by showcasing our extensive knowledge of the hedge fund space and the range of services we can offer as their needs evolve.” 

One of the key attractions of Concept’s portfolio and risk reporting solution to managers is that it offers them an aggregated view of all their assets, even those that are not being held in custody with one of Concept’s clearing firms. This gives confidence to managers, both emerging and established, who increasingly face the spectre of taking on managed accounts as they actively raise capital.

“Allocators often look for a reason to say No. We want our clients to be in a position where they never have to say to a potential investor, ‘Sorry, we can’t do it that way’,” emphasises Seibald.

The third growth area last year was Concept’s outsourced trading solution, which is distinct from the trading solution provided to its existing PB clients. 
These managers tend to have larger AUM, a greater amount of experience and longer track record, but perhaps due to management or cost considerations, are looking to outsource certain functions. This solution leverages Concept Capital’s technology capabilities. 

Seibald explains: “Our team functions as an extension of the client’s firm, processing all documentation related to opening trading accounts, executes directly with designated brokers in the client’s name, representing ourselves to those brokers as the client’s traders. This reinforces the client’s “brand” in the broker-dealer community, but also leverages our existing outsourced trading relationships with such brokers for purposes of research, conference attendance, corporate access, etc.” There are now seven traders on the desk. 

Concept’s capital introduction mission statement is to make high quality “relevant” introductions between its hedge fund clients and global investors. With a clear understanding of clients’ investment strategy, goals, and objectives, “it allows us to provide a consultative approach to capital development. 

“With an increased frequency of the capital introduction events we hosted in NYC over the past year, we have further positioned the firm as a relevant contact for the allocator community. We have also been developing a strategic relationship with Hedge Connection, which has provided our clients the opportunity to post their information and connect with allocators,” confirms Seibald. 

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