Cross-asset trading and risk management

Abstract

It is no longer acceptable practice for banks and brokers to operate in product silos, it is not only hedge funds but traditional investment managers that need to be able to trade across the different asset classes—equities, derivatives and increasingly FX and commodities. Initially, banks have been bringing together their exchange-traded equities and derivatives operations on a single order management system, but this is going further to include some over-the-counter instruments, and the much needed overlay of foreign exchange transactions. This paper examines the increasing move towards cross-asset trading and the need for trading operations within the same bank to work together to provide a single window for the multi-asset customer.