Boston, September 19, 2012 – A new report from Aite Group analyzes key industry trends influencing the future of global trading and the growing prominence of execution consulting services. Based on a Q1 and Q2 2012 Aite Group survey of 22 broker-dealers, this report examines some of the operational and technical challenges that market participants face in scaling their execution consulting business. It also profiles 20 brokers that consented to share information about their execution consulting service offerings.
The somewhat utopian industry prediction of machines completely taking over human traders has failed to materialize. In fact, as electronic execution services continue to become more sophisticated, the buy-side demand for hands-on broker support has increased substantially over the last five years. The line between low-touch and high-touch service is becoming increasingly blurred as buy-side clients demand “mid-touch” services that blend self-service execution with support in the form of real-time advice and guidance. This demand has led to execution consulting services going mainstream as the broker-dealer community seeks to support its buy-side customers.
“The actual definition of execution consulting services still varies quite widely depending on which broker one speaks with,” says Sang Lee, managing partner with Aite Group and co-author of this report. “For some brokers, it is synonymous with trade analytics, while others associate it with customizing algorithms. The common theme running through any definition is the ability to provide a more hands-on approach and customized products and services to meet clients’ trading needs."
The report profiles the following brokers that provide execution consulting services: Bank of America Merrill Lynch, Barclays Capital, Bloomberg, Citi, ConvergEx, Credit Suisse, Deutsche Bank, Goldman Sachs, Instinet, ITG, JP Morgan, Knight, Liquidnet, Pico Quantitative Trading, RBC Capital Markets, Societe Generale, UBS, Wedbush, Weeden, and Wells Fargo.
This 53-page Impact Report contains 34 figures and one table. Clients of Aite Group’s Institutional Securities & Investments service can download the report.