Simon Hayley is a Senior Associate at Pareto Partners
Simon Hayley is a Senior Associate at Pareto Partners

Investing in STP – applying Pareto's principles

Pareto has invested massively in STP and Simon Hayley explains why their trading style makes STP particularly important.

First Published: e-Forex Magazine 12 / Case Study / October 2003

Pareto is one of the world's largest managers of third party currency risk, with 30bn dollars under management. This makes it one of the world's largest non-bank traders of FX. Our clients are pension funds, endowments, banks, monetary authorities and funds of funds. They employ us because we have a long track record of proven value added at a low risk level. Efficient trading and record management are needed to provide this level of service. Pareto is also in competition with - amongst others - the world's largest banks. These factors alone would give Pareto a strong incentive to invest in STP. But our unique trading style makes STP even more important.Pareto follows a quantitative trading strategy. Risk management is central to our approach, but our quantitative models also add value over time, with a live track record of around 1% outperformance per annum. Offering clients a positive average return whilst also substantially reducing their risk levels is an attractive package, but it depends on a robust...continued

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