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Pershing
The three-year growth rate in prime services at Pershing now exceeds 75 %. This is impressive , given the determination of the management to be catholic in their selection of strategies , resistant to leverage-hungry managers that might put the wider franchise at risk and prudent about the degree of operational intensity they can absorb . Top-scoring for operations is one measure of their success in maintaining that discipline . “ Very smooth operations , and very helpful in the event of a counterparty issue ,” writes a client . “ It is impressive how knowledgeable , friendly , and efficient their operations personnel are .” A conservative approach to risk and return reminds clients and investors that Pershing is owned by an AA-rated global custodian bank with $ 33.5 trillion of assets in custody , which processes transactions rather than trades securities . The score for trading and execution , where a conflict-free Pershing can offer a choice of venues as well as post-trade efficiency , is predictably high . But the benefits of the parentage go beyond the obvious . BNY Mellon helps with low-cost funding , delivers a steady stream of referrals and provides a place to put unencumbered assets ( via PrimeConnect ) or even park trades that make less sense for Pershing . As a clearing firm for brokers , RIAs and financial advisers , Pershing has many strengths of its own , including a steady flow of client cash . Not the least of them is a $ 1.7 trillion box of securities Pershing can tap even before turning to external sources such as its parent . The scoring of the firm for stock borrowing suggests it can not only keep its clients in trades for longer but do so at stable rates . “ We use Pershing for all of our shorting activity ,” writes a client . “ We get great colour and very good borrow opportunities ( access and terms ).” Perceptions of client service , which is based on a single point of access to a dedicated team , are even more flattering . Several reps are name-checked . “ Pershing is very hands on with their client service ,” adds a client . “ They regularly reach out to us to make sure that we are aware of any issues , and we appreciate the extra distance they go for handling our accounts .” The current rate of growth is the best tribute to the Pershing approach to sales and marketing but there are scores and comments to match . “ Our sales rep is always available and open to implementing pricing improvements as we grow ,” notes a client . The effort to recruit credit managers , less through leverage than by operational efficiency and assured short-covering , earns its reward in a handsome score from managers of strategies most prime brokers now abjure . Pershing is also having some success with liquid alternative strategies run by mutual funds , which like a conservative prime , and value the transparency and collateral management functionality of PrimeConnect . Technology is not , as it happens , the strongest area for Pershing , but views of PrimeConnect are enthusiastic (“ The system is amazing . It has streamlined our collateral management process by making it much more efficient ”) as well as glum (“ It is not great ”). Assessments of NEXEN , the cloud-based platform built by BNY Mellon to give clients more control , must wait until 2019 . Most weaknesses in other areas reflect the limits of the services ( Pershing provides FX execution rather than FX prime brokerage and clears options but not futures ), and there is praise for the risk managers . “ They are careful and intelligent , with a willingness to hear and discuss different ideas we might bring to their attention ,” says a client .
31 %
By size
23 %
46 %
Weighted average scores
PROFILE OF RESPONDENTS
Large Medium Small
Weighted average scores by service area Service area
By location
100 %
2016 2017 2018 5.62 5.93 6.07
Weighted average score
Capital introductions 5.53 3.1 % Client service 6.51 8.3 % Consulting N / A N / A Operations 6.60 10.7 % Technology 5.79 3.4 % Product development 5.49 0.5 % Risk management 5.43 -2.5 % Asset safety 6.31 9.9 % Sales and marketing 6.16 0.4 % Trading and execution 6.08 3.9 % Delta 1 , swaps and financing 6.37 11.4 % Stock borrowing and lending 6.10 2.3 % Foreign exchange prime brokerage 5.37 -5.3 % Fixed income 5.93 2.8 % OTC clearing N / A N / A Listed derivatives 5.38 -8.7 % Total 6.07 4.6 %
Americas Europe and Middle East Asia
+/ - the global average
88 Global Custodian The Hedge Fund Annual 2018