Abstract

French Equities : interactions between Portfolio Management and Trading This paper relates the main findings of a survey of major institutional fund managers active in French equities on their investment process, their trading practices and their expectations regarding the trading procedures on the Paris Bourse. More specifically, this survey analyses the interactions between portfolio management and trading. French institutions, like US and UK investors, are very concerned about the quality of execution of their orders. Aware of the impact on portfolio performance of the various trading costs arising from execution, investors implement trading techniques consistent with their type of management and which are likely to reduce execution costs. Value managers are medium-sized institutions. They are the most « patient » traders and tend to delay trades to improve execution. Quantitative managers are the smallest institutions. They are the most « unpatient » traders and trade most of the time in the central order book, using orders likely to generate rapid execution such as market orders. The largest institutions apply « mixed » investment strategies (value-based and quantitative strategies ). Their demand for immediacy is average and they use more than others the immediate execution facilities offered by brokers to trade their large orders.

Talk to us

Join us for a 30 min session where you can share your feedback and ask us any queries you have

Schedule a call

Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.