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Prime brokerage services arise as key pillars of the worldwide ecosystem while tumultuous economic and political dynamics sweep the financial markets and novel laws are implemented. This article will explore the most important pillars of reliable brokers, followed by the top 5 brokerage services for intermediaries.

Uncovering the Advent of Prime Brokerage Services

Prime brokerage encompasses a palette of services supplied by investment banks, wealth management companies, and securities dealers to hedge funds that need the capacity to borrow securities and cash to invest on a net basis and obtain an absolute return. Overall, these dynamics provide their customers with great benefits, including asset managers, banks, prop trading businesses, and so on.

Large financial institutions may streamline and outsource most investment processes using a prime brokerage service. Hence, these organisations may subsequently focus on investment goals and methods and delegate investment responsibilities to their prime brokers.

Evaluation Criteria for Prime Brokerage Providers

In the process of selecting a prime broker, there are several variables are considered:

Asset segregation and trusted custodians: It is imperative to separate the broker’s and client’s assets. The customers’ funds should be securely stored in separate accounts with large global banks.

Reporting: Reports should be available in a multicurrency format for internal and external use. Furthermore, the brokerages should offer the option to customers to acquire a custom report from their account manager.

Transparency: Since the global financial crisis, increasing openness about services and costs has been one of the most important reforms in the prime services sector, underscored by global regulatory developments, including the European Union’s Markets in Financial Instruments Directive II (“MiFID II”).

Direct market access: Prime brokerage suppliers should provide access to a wide pool of financial instruments, including stocks, forex trading, cryptocurrencies, currency pairs, and ETFs, in a direct manner.

Multicurrency account: Generally, prime brokerages should host multicurrency accounts that allow the holder to spend, receive, and store different currencies. It may function similarly to an international checking account with many subaccounts, each in a distinct currency.

Global licenses: Overall, licenses should be issued in various jurisdictions, so the clients can choose the one that suits their requirements.

Solid financial position: Fund managers want to ensure that their prime broker is financially stable and has sufficient risk management strategies. They want to ensure that their accounts are safe so that investors are not rebuffed when allocating capital to their fund.

API: As a core operational element, the trading API connects a trader’s account to a broker’s automated trading system to execute transactions quickly and effectively and algorithmic or programmed trades in specific situations.

Competitive rates: Pricing is crucial since management must control their expenses. They demand a competitive price structure that meets their requirements, whether a tiered commission structure based on monthly volume or an all-inclusive flat cost.

Fast multilingual customer support: Customer support should be available in a multitude of languages to ensure that communication is preserved. Furthermore, the response time should be as fast as possible to address the clients’ needs in a timely manner.

Convenient terminal: Ultimately, a cutting-edge prime brokerage provider is supposed to provide comprehensive order administration, portfolio management, and risk modelling features on a specialised trading platform for asset managers.

Ultimately, choosing the right broker relies on these three overarching considerations:

  • Which institute aligns with your values and mission
  • Which provides the best package for you
  • What your financial goals and strategies are

Rating Prime Brokerage Services for Intermediaries

Considering the aforementioned evaluation criteria, we will uncover the top 5 prime brokerage service providers for intermediaries that deploy B2B FinTech solutions on a worldwide scale.

1. EXANTE — BEST Broker for Institutional Traders & Asset Managers

EXANTE logo

EXANTE facilitates fast and accurate reporting in several currencies for internal and external usage, arising as a leading B2B trading platform. Furthermore, EXANTE provides competitive and clear pricing. The company only imposes trading commissions and data feed fees. The platform offers direct market access to over 50 worldwide exchanges for your customers and provides access to stocks, ETFs, bonds, futures, options, metals, fiat, and cryptocurrencies from a single multicurrency account. In this pursuit, EXANTE integrates fix API that enables customers to utilise their own hardware with near-zero latencies.

Furthermore, EXANTE exhibits a trustworthy asset separation custodian, which controls $1.6 billion in assets and $60 million in equities. With licenses from SFC (Hong Kong) and CySEC, EXANTE’s customers may choose the jurisdiction that best meets their needs. Seeking to provide solid customer support, the enterprise offers 24/7 multilingual help in 10 different languages, with 70% of inquiries receiving an initial reply within three minutes.

2. Interactive Brokers  Innovative & User-friendly Broker

Interactive Brokers logo

Interactive Brokers draws active traders with cheap per-share prices, a sophisticated trading interface, a vast assortment of tradable assets — including overseas equities — and insanely low margin rates. Interactive Brokers manages $10.9 billion equity capital, 75% privately held, and $7.7 billion excess regulatory capital across 2 million client accounts.

Moreover, the potent set of technologies offered by IBKR allows you to enhance your trading speed and efficiency and conduct advanced portfolio analysis. Interactive Brokers facilitates access to market data and is available 24/7 in 150 markets, 33 countries, and 26 currencies.

3. Saxo  FinTech Brokerage Leader

Saxo Bank logo

Since 1992, the Saxo Bank Group has been a world-leading supplier of electronic trading and investing services, and it has connected consumers with various financial markets. Customers are given access to more than 60,000 different financial products. They are provided with all of the information they need to make an educated choice as it collaborates with approximately 400 financial intermediaries.

Saxo offers one-of-a-kind user experiences or integrates innovative goods, services, and functionalities into your business’s user interface (UI) and underlying infrastructure. Integrate effortlessly with their REST OpenAPI, which uses SAML and OAuth to offer a safe and straightforward development process.

4. MOVENTUM  Versatile Prime Broker for Financial Intermediaries

MOVENTUM logo

Providing asset management with more than 19 years of experience, MOVENTUM manages over 1,000,000 transactions annually, 10,000 funds, and securities. In addition, Moventum handles more than 40,000 trading accounts for customers in over 120 countries. Furthermore, the enterprise is a member of the Luxembourg investor compensation system and is governed by the Luxembourg financial market regulators (CSSF).

5. GTN Group  Flexible FinTech Broker

GTN Group logo

GMA is a pioneer in Fintech investments and is currently based at Dubai International Financial Center (DIFC). Furthermore, GMA established regional hubs in Singapore, the United States, South Africa, and the United Kingdom to serve the customers in these regions and transfer synergies. GMA supplies the GTN – Global Trading Network to brokers and asset managers globally via its regional hubs and provides innovative B2B FinTech solutions. To address all of its technology needs, the company operates a software development and support centre in Sri Lanka that is entirely devoted.

Bottom Line

Without a doubt, prime brokers provide access to a level of competence that some organisations lack. In essence, a prime brokerage service enables large institutions to delegate a plethora of investing-related responsibilities to a third party, freeing up resources that may be better committed to developing these enterprises.