High Line Advisors LLC

management ideas for banks and broker-dealers

Archive for April 2011

Streamlining Equities

leave a comment »

High Line Advisors has published an article entitled Streamlining Equities: Ten Operating Strategies for Competing in Today’s Markets. A PDF of the article is available here.

“Whosoever desires constant success must change his conduct with the times.” — Niccolo Machiavelli

Article at a Glance

Equity sales and trading (“Equities”) is a core business for many banks and broker-dealers, on its own merits and because of its synergies with corporate banking and wealth management. Like all capital markets businesses, Equities under increasing pressure from electronic trading, reduced leverage, increased capital requirements, regulation of over-the-counter derivatives, and limitations on proprietary trading.

New operating conditions call for a leaner operating model to protect revenue and maintain growth, starting with a reevaluation of the product silos that require so many specialists. Profitability also depends on the firm’s ability to deliver resources to clients and capture trades with greater efficiency. Success requires re-thinking the entire legacy organization, looking at new ways to combine or expand roles, and reevaluating the skills that are needed on the team.

These ten initiatives in sales, trading, and operations, can help management streamline the Equities organization for greater top line revenue and increased operating leverage:

  1. Recast “Research Sales” for delivery of all products and firm resources
  2. Create “Execution Sales” to maximize trade capture across products
  3. Rebalance Coverage Assignments to foster team selling for client wallet capture
  4. Fortify Multi-Product Marketing to maximize product penetration and client wallet share
  5. Deploy Sector Specialists to generate alpha and raise internal market intelligence
  6. Implement a Central Risk Desk to consolidate position management and client coverage
  7. Merge Secured Funding Activity to manage collateral funding and risk
  8. Centralize Structured Products to eliminate redundancy and internal conflict
  9. Reengineer Client Integration for speed and control of non-market risks 
  10. Normalize Client Service to eliminate duplicate processes and improve client experience
Advertisements
%d bloggers like this: