INTL FCStone Financial has gone live with its new prime brokerage service, offering financing, clearing and custody services for mid-sized hedge funds.
The service will also cover multi-asset execution, outsourced trading and introducing clearing services for hedge funds, mutual funds and family offices.
The launch comes just six months after INTL FCStone, known as a commodities and FX market maker, poached three of Cowen Group’s most senior prime brokerage executives to establish a US prime services business.
“Our model couples sophisticated technology with direct clearing capabilities, combined with introduced clearing options, to enable clients to evolve without having to establish separate prime relationships,” said Douglas Nelson, co-head of prime brokerage, INTL FCStone.
“These new services will allow firms operating on legacy systems to benefit from our cutting-edge technology and streamlined cloud-based solutions, providing better service, flexibility, efficiency, and simplicity.”
Earlier this year, the firm also brought on Ben Brown, a former managing director of prime brokerage sales at Cowen, and Paul Magahis, a former director of alternative investments at Stifel Financial, as a managing director and co-head of capital introduction respectively.
Last month, it also brought on Lindsey Sine, a former prime brokerage executive at Goldman Sachs, as a director for client services and onboarding.
The new service will target mid-sized hedge fund clients, which have over time fallen at the wayside of the bulge bracket prime brokerage firms that have deemed them not profitable enough to have on their balance sheet.
“We look forward to growing the division as demand continues to increase for prime brokerage services, especially among mid-sized hedge funds both domestically and abroad,” added Nelson.
“As we continue to innovate and create specialised offerings for the marketplace, we anticipate that our ability to cross-margin multiple security types will be a large focus for us in the near term.”
Speaking to Global Custodian in November last year, Nelson said the firm expects to have onboarded new hedge fund clients by the first quarter of 2019.