High and low touch trading strategies are morphing to meet practical realities
Steve Grob, director of Group Strategy at
Fidessa, examines how a combination of convergence and
divergence is transforming the traditional approach to
sell-side trading technology and starting to bring it into line
with the convenience and efficiency we take for granted in our
daily digital lives.
In the beginning there was high touch. This phrase defined
the relationship between the investment manager and his broker
– constant communication by phone and face- to-face as
the broker provided a high value, solution-based approach to
finding the liquidity that (invariably) his client was looking
For many years this worked as the fees charged and passed
down the line were high and scrutiny over what end investor
trading commissions were actually funding remained
As markets electronified, and the buy-side tooled up their
own operations, a new paradigm was born – low touch.
This reflected the buy-side's growing desire for cheaper
execution, especially when they were putting on trades that
actually weren’t that hard to execute. It also
offered a path that minimised any information leakage and gave
them more control over the whole process.
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