Community of Interests

Terry Flanagan

Buy side and sell side providers team up to achieve synergies.

Providers of services to the sell side and buy side are forming business combinations that create a one-stop shop for securities processing and investment management.

Broadridge Financial Solutions, for example, which has a significant securities processing business that focuses on the sell side, acquired Paladyne Systems in 2011 in order to extend its reach to the buy side marketplace.

“Since the transaction closed in September we have signed over 30 new deals, added a global sales manager and 5 seasoned salespeople, and our pipeline has grown over 70%,” Bennett Egeth, senior vice president, securities processing solutions at Broadridge Financial Solutions, told Markets Media. “We are very excited to be engaged in several meaningful conversations that were not accessible to Paladyne prior to the acquisition”

Paladyne provides Broadridge with enhanced buy side processing technology capabilities and expertise covering the front, middle and back office across all asset classes.

The Paladyne name has been and is clearly labeled a Broadridge company. Paladyne operates as a core business within Broadridge’s Securities Processing Solutions division.

Paladyne offers the Paladyne Suite to hedge funds, asset managers, fund administrators and prime brokers. The Paladyne Suite includes order management, portfolio management, reference data management, data warehouse reporting and reconciliation.

A major initiative of Paladyne has been to introduce seamless straight-through workflow across a full range of asset classes in an effort to minimize trade-related errors and reduce operating costs for clients.

For example, Paladyne has integrated with Omgeo’s flagship Central Trade Matching (CTM) service for electronic matching of orders and confirmation of allocations.

“The industry continues to work towards automation of post-trade processes, to cope with increasing volumes, and reduce manual errors, which can be expensive and introduce significant risk,” Sameer Shalaby, CEO of Paladyne Systems, told Markets Media. “The Omgeo CTM integration is a significant component in automating the matching and confirmation of trades before they go to settlement.”

The integration also connects to a trade matching gateway, which will include adapters for OTC trade affirmations due to become regulatory requirements.

“Regulators are demanding that the clearing of OTC trades such as credit default swaps be moved to accredited central platforms,” Shalaby said.

This allows for much greater transparency, and facilitates risk reduction through netting of exposure. “Managers who wish to trade these securities will need to connect to such platforms electronically, and the Trade Matching Gateway will be a key enabler,” said Shalaby.

Related articles

  1. Tradeweb Draws Buy Side in Europe

    Net sales registered net outflows of €3bn, compared to €42bn in March 2022.

  2. Justin Chapman will lead the Digital Assets and Financial Markets group.

  3. BNP Paribas Asset Management launched its first European ESG ETF Barometer survey.

  4. By Greta Zhou and Andy Cheung, APAC AES, Credit Suisse

  5. The ETF provides a way for investors to potentially profit from a decline in the price of bitcoin.