Find Me a Prime

FTSE Global Markets

Will the current climate continue to favor the various small-time prime models that have emerged in the wake of the recent PB purge? Are these specialty firms capable of handling the ever-expanding field of small funds in need of a home? Dave Simons reports.
It wasn’t all that long ago that hedge funds decided that having a single prime broker (or perhaps two at the most) was too risky in the post-crisis climate, and thus began accumulating upwards of five different providers in an effort to keep their eggs in a handful of baskets. But that model was short lived, ultimately devolving under the weight of regulatory and reporting changes that made juggling multiple primes too complex for all but the largest funds; by 2011, the prime number was once again back to pre-Lehman levels.
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