B U Y- S I D E
Buy-side evades FX Global Code of Conduct labelling it ‘regulation in
disguise’
Just 11 of the 30 largest buy-side firms have agreed to adopt the Code.
A
sset management firms have expressed their frustra-
tion at being urged to comply with the FX Global Code
of Conduct, describing it as ‘regulation in disguise’ and
more relevant to the sell-side.
The Bank of England’s executive director for markets,
Andrew Hauser, told delegates at a conference in London
in December that of the concerns raised by the buy-side
when considering compliance with the Code, the unclear
business case was prominent.
“The Code is a useful guide to market conventions, but
that doesn’t mean we need to sign up,” said one buy-side
firm, according to Hauser. “The Code is really about the
sell-side putting its house in order – the buy-side has
nothing to apologise for. At best, the Code just reiterates
what we already do; at worst, it’s more regulation in
disguise.”
Some of the world’s largest asset managers, including
Vanguard, Fidelity Investments and BNY Mellon Invest-
ment Management, have still not agreed to comply with
the FX Global Code of Conduct, which came into force on
25 May 2017. In comparison, every one of the 30 largest
sell-side institutions has signed up and agreed to follow
the Code, including the Bank of China, HSBC, JP Morgan,
Citigroup, Barclays and Societe Generale.
Hauser said that in total, just 11 of the 30 largest asset
management have so far firmly agreed to adhere to the
Code. Other buy-side firms which have not include Pimco,
Amundi, Legal & General investment Management, T.
Rowe Price, Invesco, Aberdeen Standard Investments and
AXA Investment Management.
EQUITIES
Barclays bullish on equities business ahead of new algo and SOR
platform launches
Reinvestment will see the launch of new SOR and algo platforms.
U
K investment bank Barclays has said reinvestment in
its equities trading business is beginning to pay off,
as it prepares to launch new algo and smart order router
(SOR) platforms.
Barclays has produced more than 25 new features and
upgrades to its equities trading services so far this year,
including multiple new venue connections, post ahead
logic and improved closing auction offset functionality. A
recent SOR upgrade in October also saw its multi-venue
hit rates increase by 10%, while fill rates across Europe
currently stand at around 97%.
“We are particularly excited about the developments
of our next generation trading algorithms and smart
order router, which is already live in some capacity for US
clients, and will be delivered for most European markets
in 2019,” said Matt Cousens, who joined the equities team
at Barclays as head of execution sales for EMEA from
Credit Suisse in June this year. “Our latest SOR optimisa-
tion has already increased our hit rate by more than 10%
in aggregate.”
Developing advanced alpha-driven signal generation
and a sophisticated experimentation framework were
prime focuses for the team currently delivering the new
platforms, alongside a vision of redefining existing agen-
cy-based algorithmic strategies, which can often look
similar across providers.
Issue 58 // TheTradeNews.com // 11