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The last thing any hedge fund manager wants is to be off-boarded by a Prime Broker. It can be a destabilising and unsettling experience, potentially leading to a loss of confidence among investors. It is vital, therefore, to find the right Prime Broker that can partner with a manager based on a clear understanding of business wants and needs.
This is especially true in today’s regulatory environment where Basel III has caused banks to carefully consider their short-term and long-term liquidity positions and transform their businesses. In many ways, this has reshaped the Prime Brokerage relationship, making efficiencies and returns more
Regulation continues to bite and influence the way investment banks structure their business activities. Most notably for the hedge fund industry, the banks are being forced to reassess their activities pertaining to prime brokerage. Five years ago, banks remained in denial about the impact regulatory reforms would have. But then a black swan event occurred.
On 15 January 2015, the Swiss National Bank decided to de-peg the Swiss franc from the euro, sending the markets into turmoil and leaving a trail of casualties. Within a twenty-minute period, between 9.30am and 9.50am UK time, the CHF went into hyper drive, appreciating almost
With the rise of social media platforms over the last decade, led by Facebook, the way we think about connecting and interacting with people has drastically changed. LinkedIn provides a similar experience for our professional lives, while Amazon and Netflix seemingly know what we want to buy or watch before we’ve even thought about it.
This has created a unique experience where the customer feels as if they have a close relationship with the platform provider, despite being one of millions of people all benefiting in the same way.
Within the hedge fund space, one of the most important client
Mini primes and those looking to establish new prime brokerage businesses are currently a big focus for SS&C Advent, according to Roger Woolman, Business Development Director, Asset Management & Alternatives.
Over the years the firm has built long-running relationships with some of the world’s largest prime brokerages and are, without doubt, highly valued clients. But as Woolman says: “The more interesting area for us, from a new business development perspective, is firms who are looking to break into the PB arena, such as mini primes.
“We have a number of mini prime clients in the UK already and we are
The art of a good stock picker is identifying companies in obscure parts of the market that have yet to reach their full value potential, or, when it comes to shorting, have artificially high valuations. But aside from this, another skill is being able to construct trades that move anonymously through the market without signaling to others what the portfolio manager is doing.
This is something that Wedbush Prime Brokerage excels in, supporting emerging managers who have the nimbleness and dexterity to trade smaller positions.
“A long/short equity manager might focus on an obscure pharmaceutical stock, for example – many
In many, if not most, cases, capital introduction teams at prime brokers have tended to function as ‘quasi marketers’ for their hedge fund clients. The name of the game appears to be getting their clients in front of as many investors as possible, and quite often this means doing so without truly taking the time to understand what investors are looking for.
Cowen Prime Services LLC capital introduction and business consulting team takes a much more measured approach and is taking the opposite side of the trade.
“We’re not acting as distributors of information or products, we are looking to
The first quarter of 2018 saw prime brokerage revenues jump 20 per cent to USD4.9 billion for the largest investment banks according to a report from Coalition, which monitors the industry.
As the Financial Times wrote on 23 May 2018, this revenue boost was the highest in almost three years among the world’s 12 largest investment banks but signs of a sustained period of growth appear short lived. Volatility earlier in the year has not continued.
This is the fuel that hedge funds use to increase their trading activity – in so doing, increasing the revenues earned by prime brokers for giving
Mariana Enevoldsen (pictured), Director at Estera, explains how the recent IPO of music investment fund Hipgnosis demonstrates how Guernsey continues to be popular and trusted by advisers and investors, and highlights the attractiveness of the island for alternative asset classes…
This summer Merck Mercuriadis, a former manager of Sir Elton John, Guns N’ Roses, Iron Maiden and Morrissey, floated his new music investment fund on the London Stock Exchange. Hipgnosis Songs Fund raised GBP202 million to invest in music royalties. Shortly after the IPO, Hipgnosis announced the acquisition of its first catalogue of hits from The-Dream, which includes hit songs
Perpetual Corporate Trust, an independent provider of corporate trustee services to the managed funds industry and debt markets in Australia, has formed a strategic partnership with FundRock Management Company (FundRock).
The collaboration will enable clients of both firms to leverage the expertise and services offered in their respective core markets.
FundRock is an independent European fund management company employing over 100 industry professionals with presence in Ireland, UK, Luxembourg and Singapore. Established in 2004 as part of RBS, FundRock is a full-service host Authorised Corporate Director (ACD), Alternative Investment Fund Manager (AIFM) and ManCo, and now services over 300
Global network provider BSO has partnered with Hoptroff London, the time-synchronisation software specialist, to provide the financial services community with the first fully traceable accurate Time-as-a-Service (TaaS) on the market.
Since MiFID II went live in January, the entire financial ecosystem has a growing demand for a precise reading of when a trade is executed, so traceable, accurate, synchronised timing has become crucial. This new partnership combines Hoptroff’s market-leading Global Timing Network and AI enabled Time-Suite software with BSO’s global low-latency network reach, providing firms with a timestamp of trades to within ten micro-seconds of the primary reference standard of Universal Time (UTC).
This
