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Instead, a combination of rising interest rates, inflation, soaring energy prices and geopolitical tensions have hit hedge funds, and subsequently the riskmanagement practices of prime brokers. But unlike incidents of the past, the market mayhem of 2023 has not been confined to one event.
Trading, portfolio and riskmanagement solutions provider TS Imagine has added CLSA’s AI-powered European algo suite to its list of certified brokers. TS Imagine’s TradeSmart features pre-certified connections to more than 250 listed brokers and venues, as well as broker algos.
Clearing obligations will become stricter, with enhanced oversight of margin requirements and riskmanagement processes. Despite these new potentially arduous compliance pressures, trading desks are also likely to benefit from reduced counterparty risk and improved market confidence thanks to the changes.
Dominic Rieb-Smith, managing director, international head, prime services sales, JP Morgan, refers to the past year as “a standout”. Data from Convergence tracking the top 25 prime brokers showed their market share grew from 83.3% in April 2023, to 92% in 2024.
BMLL Technologies BMLL provides its clients – banks, brokers, asset managers, hedge funds, global exchange groups, academic institutions and regulators immediate and flexible access to Level 3, harmonised, T+1 historical order book data and advanced pre- and post-trade analytics at scale.
Energy Information Administration has a few simple examples here : Your discussions with customers, competitors, and other commodity brokers will also inform this curve. The downside is that it takes a long time to get your own book, which creates a lot of market/cyclical risk.
Many argue the rapid proliferation of more advanced order entry and riskmanagement technology has allowed market makers and participants to profitably provide sub penny spreads for over a decade. “You have got to applaud the SEC for having the gumption to address these issues and taking on the hard battles,” adds Bandeen.
This is the process of reviewing and evaluating a company's operations, processes, and systems in order to assess its efficiency, effectiveness, and risk profile. Additionally, you may want to consider engaging a broker or investment banker to source deals or facilitate the transaction.
It is written in a way that will help you, in case you decide to go about the process without a business broker. You are always welcome to call us or talk to any business broker about the state of the business world. As such, you should hire a consultant or a business broker to help you with setting up your marketing package.
Notable recent acquisitions include the June 2024 purchase of Sceptre Hospitality Resources, a provider of AI-based revenue generation and management SaaS for businesses in the hospitality sector globally.
To get ahead of the competition, banks need to upgrade their technology to enable faster price discovery, bespoke price creation and improved riskmanagement. Also, the velocity of the underlying market has increased which means that banks using Excel to manage their FX swaps books are now turning to technology solutions to keep pace.
Euronext introduced their dark book in Q2 2024, enabling clients to trade at mid-point in the dark. We expect more of the neo-brokers that have fostered retail participation in the US to make their way to Europe in 2025. Deutsche Borse and BME have just gone live with similar offerings in December 2024. Watch this space!
However, the jurys out on whether further fragmentation is needed given the continued squeeze in order book liquidity and/or whether the market has the capacity to connect as internalisation continues to take priority for many. I see this being a big theme for market participants next year ensuring that they are operationally resilient.
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