The broker/dealer space has undergone radical changes in the recent past due to commoditization of services, downward pressure on commissions, and high customer expectations.
Brokerage firms are looking at offering new instruments and access to new markets to broad-base revenues. They are increasingly adopting a single, multi-asset, multi-market IT system to trade multiple asset classes with ease.
A multi-asset, multi-market trading system adds ‘alpha’ to trading
It helps organizations:
- Improve operational efficiencies due to the use of a single platform
- Leverage their existing infrastructure to offer new products
- Increase revenues at minimal cost
Retail banks as ‘financial superstores’
Another dominant trend is the increasingly significant role that retail investors are assuming in trading today. As a result, more and more banks are setting up brokerage arms and becoming ‘financial superstores’ that cross-sell investment products to a diversified customer base and increase fee income. The merger of large investment banks, having expertise in capital markets, with retail commercial banks is accelerating this trend.
Integration of front-office and back-office
Market volatility, risk aversion and shorter settlement cycles are driving sell-side firms to look at integrated front-to-back-office solutions, Some of the advantages of integrated front-to-back-office solutions are-
- Online monitoring of positions and exposures
- Real-time trade push and allocation to back-office systems to manage operational risk
Convergence of Buy side and Sell side
Buy side is increasingly taking over control of trading to reduce transaction costs and improve execution quality resulting in increased spending on Execution Management Systems. There is an increase in percentage of order flow via Direct Market Access and algorithmic trading.
In short, we believe that a multi-asset platform will usher in the centralization of processes, knowledge and technology in the trading arena.
To know how TCS BaNCS can help you with a multi-asset platform trading solution, write to us at firstname.lastname@example.org