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.

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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