BestEx And TORA JV Enables Global Outsourced Trading For Australian Fund Managers
Australian outsourced trading firm BestEx and San Francisco based global trading firm TORA have announced a joint venture to offer global trading services to local fund managers.
The arrangement will allow institutional clients of BestEx to outsource their trading to dedicated, local dealing desks in all major and emerging international markets, leveraging TORA’s market leading technology and extensive broker relationships to achieve best execution of their orders.
BestEx will continue to provide trading in Australian equities with access to TORA’s technology.
Phillip Weinberg, BestEx founder and CEO, said he was delighted to be working with TORA, and that the JV comes at a time of significant growth for the firm that commenced operations in 2012.
“The outsourced trading model, while established in offshore markets, is gaining strong traction in Australia,” he said.
“TORA has pioneered the model using its own specialised technology and teams of professional traders around the globe focused on best execution.”
Weinberg believes that changes to equity market structures in recent years and the global regulatory focus on ensuring fund managers meet their best execution obligations will lead to greater adoption of outsourced trading in Australia.
“Fund managers globally have been forced to change the way they approach trading, often resulting in separation of investment decision making from the trading function,” Weinberg said.
Weinberg says that as markets have become more complex, the effect of trade execution on investment performance has grown. He says fund managers that can access more liquidity and minimise their market impact have a distinct advantage over their peers, but they are a select few.
“The majority of fund managers in Australia lack the technology and skills required to effectively manage their trade execution and too often outsource the task to brokers who may have competing interests,” he said, adding that this can even be the case for fund managers that employ their own in-house traders.
“Significant cost savings for the fund manager and better outcomes for their investors can generally be achieved by a manager outsourcing their front office, not unlike what they typically do with their back office,” he said.
Chris Jenkins, TORA’s Asia Pacific Managing Director, said he saw the relationship as a great opportunity to offer TORA’s global trading reach and cutting edge technology to the Australian buy-side industry.
“Outsourced trading is an area which is rapidly gaining interest throughout Asia and this venture with BestEx allows the Australian client base to gain seamless access to global markets,” Jenkins said.
Chris Jenkins and Khahlil Kirtman, Managing Director of TORA Trading Services, will be leading the efforts for TORA.