Latest Blog Posts

How can Big Data help optimise trade execution?

Philip Gladwin, Bloomberg Tradebook

Mar 12, 2014
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Googling “Big Data” results in 2.1 billion hits in 0.4 seconds. That in itself is big data indeed. According to a McKinsey study, big data is impacting the private sector as well as government, retail, healthcare, the computing industry, and academic research. The financial industry had been progressing into this area well before the “big data” label was applied. In this post, we explore what it means to work with large sets of market data and the challenges of doing that well to generate best execution for the client. read more

Reporting, reporting, and yet more reporting

Christian Voigt, Fidessa

Mar 12, 2014
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While many European firms are still getting to grips with EMIR trade reporting and the headaches it’s caused, the next reporting challenge is already on the horizon in the form of MiFID/R. It helps that MiFID/R does not require double reporting as long as the required information is reported once under EMIR. However, aiming to strengthen transparency, the scope of MiFID/R’s transaction reporting is wider than that of EMIR’s trade reporting and affects all financial instruments, not just derivatives. read more

A tad more on wealth management fees

The Banker's Umbrella

Mar 05, 2014
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Following a bit on last week’s post about private banking fees. David Jones and Merryn Somerset Webb pointed me on to an interesting article published in MoneyMarketing.co.uk by Sam Macdonald “How much are they charging? New research reveals what the big firms cost”. It found that annualized fees for some wealth management providers exceeded 6%. Anyway you spin it, this is daylight robbery. The reason you have your wealth managed is to make money. And if we get a little technical, when paying for someone to do it for you, you should be getting some form of additional return, by that I mean a return in excess of a passive market investment. read more

Alpha Innovation Required

Steve Grob, Fidessa

Feb 28, 2014
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My thanks to Bill Stephenson and all at Franklin Templeton for asking me to participate in their inaugural innovation summit in Fort Lauderdale this week. The idea was to bring together a bunch of cool technology vendors and allow them to present and discuss how their particular offering helps the buy-side generate alpha. This is no trivial problem as the buy-side is having to look further and further afield (both geographically and by asset class) if it is going to generate the returns it once did. At the same time, the overload of structured and unstructured information makes doing this harder and harder. read more

How Private Banks Make Money, Part III

The Banker's Umbrella

Feb 26, 2014
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Here is the third part of the “How Private Banks Make Money” series. These fees are often confused with safe custody fees, however it is a completely different kettle of fish: Portfolio Management Fees. The client of a private bank has two options, either they make the investment decisions themselves, they have an advisor/ private banker who they consult and who makes suggestions, but it is the client who makes the final decision. Then there is the other option, when the client hands over the investment decision making process to the private bank. read more

Prepare yourself, MiFID II has arrived!

Christian Voigt, Fidessa

Feb 20, 2014
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Yesterday the Council of the European Union published the long-awaited texts for MiFID II and MiFIR as agreed by the Council and the Parliament on 14th January. Whilst the texts are still subject to ECON and Plenary votes in March and April, and the Commission has some outstanding concerns about the derivatives rules, it’s likely we will all have to implement the rules outlined in these 700 pages in the coming years. The new legislation will apply from some time in late 2016 – the exact date pending publication in the official journal after April’s Plenary vote. read more

How Private Banks Make Money, Part II

The Banker's Umbrella

Feb 19, 2014
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So here it is, the second part of the ongoing series of posts on how private banks make their moolah. Last time we went through the bread of private banking - custody fees - and now we get to the butter: Transaction fees. Before you open an account with a private bank you’ll be shown a price list (that's if you can get an account open nowadays, because it isn’t easy. The paperwork alone is scary). The first thing you need to understand is that if you have the money to be a private banking client, the price list is open for negotiation. read more

SEF and agency make a perfect MATch

Mark Brennan, Fidessa

Feb 14, 2014
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From next Tuesday, February 18th, US market participants will be required to trade fixed-floating interest rate swaps denominated in dollars or euros for standard benchmark tenors on a SEF. Long part of Dodd-Frank’s Title VII statute, this trade execution mandate now comes about and follows the CFTC’s certification of Javelin’s MAT submission last month. During the past week the Commission has tried to ease the momentous transition to this new market structure through its exemptive relief for package transactions and new guidance on the US/EU “Path Forward” rule harmonization, with exemptive relief for US participants transacting on EU MTFs. read more