Renee Benton Director of Product Management, Currenex
Renee Benton Director of Product Management, Currenex

FX Prime Brokerage - technology reducing risk

Today, Prime Brokerage services extend far beyond the optimisation of credit. Renee Benton traces some common features of eFX prime broker services and the reasons for their demand.

Prime Brokerage services were already well established in the equities and futures markets when, in the mid 1990's, they first began to appear in foreign exchange as hedge funds began to realize that they could reduce their overall forex margin requirements (and thereby maximize their leverage) by clearing through a single channel. As the product matured, funds found access to additional, often specialized, liquidity by taking advantage of their banks own credit lines. Now a mainstay for most alternative asset managers, prime brokers have widened their target audience to include corporates, banks, and even traditional money funds. Foreign exchange prime brokerage started as a way for banks to increase their volumes with particular customers and has grown steadily for a number of years in the U.S. and has recently enjoyed increased adoption internationally, particularly in London. Today, prime brokerage services extend far beyond the optimization of credit. The new goal is to enable customers to focus...continued

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