Opalesque Industry Update - Prior to COVID-19, the hedge fund industry was already facing dual challenges of rising costs and compromised profitability. However, prime brokerages have to a large extent passed the first tests posed by the pandemic relating to volumes and credit risks. Future disruption will need to be managed in tandem with catering to shifting client activity. These challenges come against the backdrop of an uncertain - yet still pressing - regulatory timetable. Preparedness, bandwidth and flexibility will be key to adjusting to this new environment. In the attached paper Anthony Bennett, Capco UK's Prime Brokerage Practice Lead, shares consolidated industry insights in view of the ongoing coronavirus pandemic. These include:
1. Primes have learned lessons well… to date - They have weathered the initial storm of volatility, de-risking and volumes, achieving this owing to previous investment in platform maintenance, automation of tasks and close management of client exposure. Anthony believes the future state of prime brokerage is a Prime-as-a-Service model, which will allow primes to provide data and services that more efficiently support their client's strategies. Bg
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Industry Updates
Prime brokerage firms have learned lessons well… to date
Wednesday, May 13, 2020
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