Markit Acquires thinkFolio

Terry Flanagan

Markit, a financial information services company, has acquired thinkFolio, a London-based maker of portfolio management software.

The software from thinkFolio offers order management (OMS), portfolio modeling, compliance and cash management capabilities for the cash and derivative markets across multiple asset classes including bonds, commodities, equities and foreign exchange. Around 3,000 traders and portfolio managers at leading buy-side firms use thinkFolio today.

The acquisition expands Markit’s franchise in enterprise software and its ability to provide front office solutions. thinkFolio is already integrated with Markit’s enterprise data management platform and certain data services from Markit, such as Transaction Cost Analysis and iBoxx fixed income indices.

“thinkFolio and its team are best in class,” said Daniel Simpson, managing director and head of enterprise software at Markit. “The software has superb functionality, is straightforward to implement, and fast and cost efficient to use. This acquisition expands Markit’s technology offering for the front office and enables customers to source order management and portfolio management software as well as enterprise data management, transaction cost analysis and risk analytics, all from a single provider.”

Markit’s acquisition of a trade order management system “makes a play into the front office,” said Denise Valentine, senior analyst in institutional securities and investments at Aite Group. “An OMS solution provides trade execution, portfolio modeling and trade compliance and thinkFolio fits the bill.”

Markit resources, such as a global salesforce, will enable thinkFolio to reach beyond its UK core of clients. thinkFolio’s clients, for their part, may benefit from an already integrated Markit EDM, an enterprise data management system, according to Valentine.

“These days the front office is a data crunching hound for data and the tools need to absorb far greater volumes of data—in good form and on a timely basis,” she said.

thinkFolio will operate as a business unit alongside Markit’s other enterprise software platforms, including Analytics, Enterprise Data Management and WSO. “We are impressed with Markit’s entrepreneurial culture and its rapidly growing group of software businesses,” said Andrew Walsh, chief executive officer and founder of thinkFolio. “Our experience of working with Markit on product integration has been extremely positive and gives us great confidence that we will thrive as part of Markit. Markit’s global reach will take our product to the next level and help drive our mission of providing a first-class product with excellent customer support.”

Data and indices is one of Markit’s core businesses that was built up partly through acquisitions, such as when Markit in 2007 acquired International Index Company Limited (IIC) and CDS IndexCo.

IIC, which operates as a wholly-owned subsidiary of Markit, owns the iTraxx Europe and iTraxx Asia credit derivative indices as well as the global family of iBoxx bond indices.

CDS IndexCo owned the CDX credit derivative indices and the synthetic structured finance and loan indices ABX.HE, CMBX and LCDX.

The iTraxx and CDX credit derivative index families, which resulted from the merger of dealer-owned indices in 2004, have increased the transparency and liquidity, and provide investors with an efficient, rules-based tool to gain or hedge exposure to the underlying credit markets.

The iBoxx bond index family was the first comprehensive suite of independent, transparent, multiple-contributor priced bond indices.

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