MSCI urges investors to consider ESG in decisions

https://seekingalpha.com/news/3533108-msci-urges-investors-to-consider-esg-in-decisions?utm_medium=referral&utm_source=feed_news_all

Liz Kiesche, SA News Editor – “Portfolio managers should integrate ESG in portfolio management, including security selection, portfolio construction, risk management, performance attribution, and client reporting.”

MSCI Website

MSCI Principle’s Of Sustainable Investing

SEF Trading Stumbles to End the Year

https://tabbforum.com/opinions/sef-trading-stumbles-to-end-the-year/

Colby Jenkins TABB Group – “Taking all of this into account, 2019 was nonetheless an up year for SEF trading (Exhibit 4, below). Compared to total notional volume traded two years ago, notional SEF activity has grown by just under 40%, or roughly $58.15 trillion, since 2017 – primarily driven by the IRD market. With a significant slowdown in IRD SEF trading over the past quarter, though, 2020 is already shaping up to be a year of further departure from the SEF market status-quo.”

InfoReach Includes Algo Wheel with TMS

http://www.globenewswire.com/news-release/2019/12/17/1961861/0/en/InfoReach-Includes-Algo-Wheel-with-TMS.html

InfoReach TMS Algo Wheel includes:

  • Broker and algo selection backed by machine learning
  • Best execution reporting
  • Improved performance
  • Decision making based on 
    • Historical performance with a variety of benchmarks
    • Commission schedules and commitment levels
    • Which broker has received orders in the same instrument

TMS’s Algo Wheel is an excellent option for many buy-side teams. 

Blockchain for the Buy Side

https://tabbforum.com/opinions/blockchain-for-the-buy-side/

Monica Summerville TABB Group – “The areas of significant benefits in using blockchain-based solutions were overwhelmingly cited as improved clearing and settlement as well as increased operational efficiency. The areas in which respondents said blockchain would have a significant impact over the next five years were:

  • Fees and costs.
  • Compliance and regulation.
  • Data management.”

Mutual fund giant Vanguard has partnered with Nasdaq Ventures-backed blockchain startup Symbiont to develop a trading platform for the $6 trillion currency market, the companies said.

https://www.coindesk.com/vanguard-developing-blockchain-platform-for-6-trillion-forex-market

Outsourced Trading Goes Viral

https://tabbforum.com/opinions/outsourced-trading-goes-viral/

Michael Mollemans TABB Group – “Beyond the basic features of outsourced trading services, many firms try to differentiate themselves by emphasizing services such as technology and analytics, access to a wide broker network, regulatory reporting, flat monthly fee pricing options, prime brokerage services, and more. While the firms that have been providing outsourced trading services for many years argue that they benefit from experience, newer entrants in the space say they gain from leapfrog effects in trading and process technology”

Two Sigma launches portfolio risk management solution for institutional investors

https://www.hedgeweek.com/2019/11/13/280434/two-sigma-launches-portfolio-risk-management-solution-institutional-investors

Users looking for more robust, portfolio level analytics can take advantage of Venn Pro, a solution that is offered on a SaaS subscription model and includes additional features such as custodial integrations and portfolio optimisation and special access to product specialists on the Venn team at Two Sigma.

Inside Outsourced Trading: The Buy-Side Perspective

https://tabbforum.com/opinions/inside-outsourced-trading-the-buy-side-perspective/
Michael Mollemans – “Further, the typical workflow, duties and responsibilities of buy-side traders are quite different from sell-side traders. Outsourced traders are mandated to be an extension of the buy-side firm and so buy-side trading experience can be very helpful. In fact, buy-side firms often insist that their outsourced trader have buy-side experience so that they understand the unique responsibilities of the role, and this is among the service offerings most valued by managers (see Exhibits 1 and 2, below). Outsourced trading firms understand this point and often hire only traders with buy-side experience.”

Greater Flexibility in Acquiring Research Encourages CSAs

https://tabbforum.com/opinions/sec-extends-no-action-relief-on-mifid-ii-greater-flexibility-in-acquiring-research-encourages-csas/

Christopher Tiscornia – “As we move forward, U.S. asset managers need to implement best practices to promote greater transparency and support the spirit of MiFID II and its unbundling requirements. These practices include:

  • Having a thorough, defensible process around research valuation and consumption.
  • Unbundling the trade execution decision from the research decision via the use of CSAs.
  • Providing transparent reporting of research funding, consumption, and value to asset owners and regulators.
  • Ensuring that the interests of managers and asset owners are aligned. Managers need to articulate how their research spending patterns, approaches to investing, and enhanced reporting processes are consistent with asset owners’ expectations.”