The world's top futures brokers are facing pressure from slow markets and tough regulatory reforms
Brokers must balance commercially-viable clearing businesses
with cost-effective client servicing, writes Dan Barnes
Asset managers are prepared for a bump in the costs of
clearing over-the-counter (OTC) derivatives, however they warn
that brokers must pass on efficiencies in the market structure
and absorb some cost themselves if they are to remain
Supurna VedBrat, co-head of the electronic trading &
market structure at asset manager BlackRock, said: "We are in
the very early stages of clearing; we fully expect there will
be a re-pricing as market participants get a better
understanding of what the cost structure really is. We are
willing to pay for reduction in risk but not for inefficiencies
that are currently in the system such as limited cross margin
benefit offered at a client level relative to sell side."
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