Fidelity Allows Hedge Funds To Rank Brokers

Aug 10 2012 | 2:08pm ET

Fidelity Capital Markets has launched a pricing tool that allows investors to compare and rank the performances and securities lending rates of a variety of prime brokers.

PB Optimize, as it’s called, is run by the firm’s own brokerage arm, Fidelity Prime Services and is the first tool of its kind to be offered by a prime broker.

Fidelity says the tool will help its hedge fund clients (at no additional charge) allocate their short portfolios among their prime brokers.

Thomas Tesauro, executive vice president of Fidelity Prime Services, said: “By sharing Fidelity’s lending rates alongside those of other prime brokers we are putting our clients and their investors first, empowering them to make more informed decisions. We expect this tool will ultimately drive market efficiency, benefiting hedge funds as well as investors.”

The PB Optimize tool provides managers with a broker scorecard, which allows clients to look at prime broker performance; a research tool to allow hedge fund clients to compare different securities; and cost analysis, which alerts clients to rate optimization opportunities across prime brokers, helping them to identify cost savings. The independent data on securities lending is provided by Markit.


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