AMERICA
AT THE
CROSSROADS
Patrick Connors, head of outsourced trading, Weeden Prime Services
T
he US stock market is in
deep trouble, hurt by a
declining small-cap market
and the global shift towards
passive investing. A look
under the hood of the market reveals
some deeply worrying structural flaws,
according to Patrick Connors, head
of outsourced trading at Weeden
Prime Services, based in Greenwich,
Connecticut, USA.
10
Fifteen years ago, Connors co-founded
Greenwich Prime Trading with Eric
Savitz. At the time, they were pioneers
of outsourced trading. The idea was
that smaller asset management
companies could outsource their
trading, thus replacing a fixed cost with
a more scalable one. In September
2016, both Connors and Savitz joined
Weeden Prime Services to run an
outsource trading desk (which the firm
www.buysideintel.com
previously didn’t have). Weeden Prime
itself mainly serves hedge funds and
family offices in the US.
“Small-cap stocks are being killed
off by the separation of commission
payments for research and
execution,” said Connors. “Brokers
are reluctant to make markets in
small stocks because it’s no longer
economically viable. Small caps are
being cut out from the market.”
October 2016