Penson Worldwide – a provider of clearing, custody, and settlement services in North America, and now Europe – has launched an electronic execution service for its European broker/dealer and asset management clients.
Penson’s one-stop shop execution, clearing, custody and settlement service will support its clients’ trading activities via their own stock exchange memberships and provide electronic direct market access trading of equities, derivatives and CFDs to all other European and North American markets. The addition of this hosted Order Management Solution (OMS) and electronic Direct Market Access to Penson’s more traditional business areas of clearing, settlement and custody aims to provide UK, Irish and European broker-dealers and private client asset managers with what Penson describes as “an end-to-end e-trading solution.”
“2004 marks a new phase in Penson’s development as we expand our services to accommodate the front and middle office,” says Chris Gregory, Director of Execution Services, Penson Worldwide. “We wanted to provide our global client base with a ‘one stop shop’ trading solution that simplifies the processes within the increasingly sophisticated worlds of agency trading, as well as risk arbitrage, hedge fund and programme trading, and further improving Straight-Through Processing. Penson’s end-to-end eTrading platform will do just that.”
The project, providing a multi-market, multi-instrument trading system, Exchange-hub connectivity and electronic Direct Market Access brokerage, underpinned by Penson’s settlement, clearing and custody services, covers all European equities, exchange-traded derivatives, and CFD Swaps. It is due for completion by the end of the first quarter of 2004.
The Exchange-hub connectivity for Penson’s Execution Service is provided in partnership with RTS Realtime Systems.
The trading will be supported in two ways. First, via exchange connectivity trading software that enables clients to trade under their own membership against Exchanges and Retail Service Providers (RSPs) Secondly, via multi-market, multi-instrument, electronic Direct Market Access through Penson.
The trading software is available in three levels. At the Professional Level II client application, with full OMS, risk management and trading functionality, with hosted server architecture; in a browser-based version of the full trading functionality; and as a white labeled client order entry browser. Penson’s International Execution Service, backed by a single, multi-asset clearing, settlement and margin account from Penson, also aims to deliver significant cost savings to its clients.
“Financial institutions worldwide are increasingly experiencing hikes in the fixed costs of maintaining their own operational infrastructure,” adds Gregory. “This factor, combined with growing regulatory compliance demands and the need to constantly evolve to maintain a competitive edge, has paved the way to an increase in demand for quality, dependable and low -cost outsourced alternatives. We are already seeing the demand for these services among our existing and prospective customer base and we now look forward to reaching out to the wider market.”