Buy side cross asset derivatives traders debate status quo
and how to evolve trading to the next level
On the 9th October 2018, The Buy-side Trading
Community (BTC) by K&K Global Consulting (K&KGC)
widened its scope of the private, exclusive, invitation only
Alpha Trader Forum (ATF) buy-side trading roundtable
debates with its inaugural cross asset derivatives meeting
in partnership with BNP Paribas, CME Group and Fidessa.
22 heads of derivatives trading from the largest global
and European asset management firms were represented
at the meeting in London.
Anita Karppi, Managing Director, BTC by K&KGC said;
“The buy-side heads of trading had flagged the need for
derivatives traders to meet and discuss how to improve
their processes for the last few years. The buy-side trading
community are increasingly establishing more cross
asset derivatives trading functions and it made sense
for us to cater with our specialisation of bringing the
buy-side community together to discuss how they could
improve their processes at the derivatives dealing desk.
Ultimately all of our activities are in the best interest of
the end investor. The conversations at our first ATF cross
asset derivatives meeting highlighted areas in need of
optimisation and the only way to resolve such challenges
is for intelligent people to meet and discuss. We have
already had similar conversations for trading within
cash equities, fixed income bonds and foreign exchange
over the course of the last 10 years and I feel we have
contributed to the evolution of the buy-side trading desks
in these areas.”
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Trading technologies
Most European based asset management firms have
invested in legacy OMS infrastructures which from an
interoperability and cost perspective limits the range of
other trading technologies that can be adopted to the
trading desk. Several OMS vendors in the industry have
or are undergoing takeovers by larger firms so it will be
interesting to see how that will impact the development
of the existing technologies.
The choice of OMS brand has often been driven from
a cash asset class perspective and rarely caters fully
for the more complex requirements of the derivatives
trading desk.
The meeting highlighted the availability of derivatives
centric trading technologies on the market and
the buy-side firms need to evaluate if the workflow
improvement from a best-of-breed solution is sufficient
to cover the incremental savings on the trading desk.
The derivatives trading desks are increasingly being
catered for with new types of trading algorithms. This
is an area of focus and still in development with such a
wide range of instruments.
The ATF participants also discussed the benefits of
straight through processing (STP) with better real-
time information flow between the clearing houses,
brokers and buy side to optimise the use of capital and
collateral.
www.buysideintel.com
Winter 2018