Tourmaline Partners, LLC

Jesse Forster highlights the following in Coalition Greenwich (a division of CRISIL) recent article, The Unintended consequences of declining commission rates:?A squeeze on both sides: The Buy-side is crying out for better (senior, experienced) coverage.?Investment Managers are: ·????????Trying to do more with less, as U.S. Equity Commissions have dropped 11% to $5.89B; ·????????Being squeezed by increasing technology and compliance costs; ·????????Seeking brokers who focus on customizing service and optimizing performance rather than profitability and margin; and ·????????Still focused on sourcing natural liquidity to allocate a diminishing commission wallet. Per Coalition Greenwich, 54% of buy-side respondents claim that “getting proper coverage” from their brokers is a top pain point.? At Tourmaline Partners, LLC we note that ALL of these challenges and trends are also driving demand for both outsourced and supplemental trading expertise.? Investment managers and asset owners engage Tourmaline to: 1.??????Expand their path to liquidity and market intelligence;? 2.??????Right size their broker counterparty lists and firm expenses to their AUM; and 3.??????Improve the flexibility of managing their commission wallet via CSAs, aggregation and sell-side research attribution. Tourmaline’s scale, independence and buy-side trading expertise provide a turnkey, variable-cost solution to improve workflow and drive performance.? #outsourcedtrading #buyside #commissionmanagement #hedgefunds #trading #equityresearch?

Outsourced Trading Sees Continued Growth Demand for outsourced and supplemental trading solutions has led to an increase in the number and types of providers.?Yet, there are still only two “business models” in the space - Buy-Side and Sell-Side.? Sell-side brokers who offer outsourced trading require that investment managers domicile all of their execution with a single broker dealer. The buy-side offering, however, is quite different, and can provide a broad reach to sell-side liquidity and market intelligence if properly scaled.??? ?? Tourmaline Partners, LLC is positioned as a buy-side trading desk and as a single broker counterparty to our clients.?We represent 350+ investment managers and asset owners, to over 440+ brokers globally, with customized trading solutions that manage the full life cycle of the trade.? Our independent, scaled, pure-play buy-side model is a flexible, best practice framework to seek best execution, drive performance and manage commission wallets globally. Request our predictions and observations on the current industry landscape at [email protected] #outsourcedtrading #buyside #commissionmanagement #hedgefunds #trading #equityresearch

Well done, Jesse Forster.?We agree. Now in our 13th year, Tourmaline Partners, LLC sees this every day. ?? The business of outsourced trading has evolved and institutionalized.?Once a business supporting hedge funds at launch, today we are just as likely to see requests from more traditional managers - those with tens or hundreds of billions in AUM - who seek to “supplement’ their path to liquidity, research and market intelligence.? This is our fastest growth silo and our largest total addressable market. With independence, scale and expertise, we provide a turnkey solution that helps buy-side traders expand their reach to BDs with whom they don’t interact directly.?This helps to drive performance and manage broker lists.?????? Any buy-side panel or discussion about ‘accessing liquidity’ should now include how the use of an expert trading firm can provide ‘supplemental’ reach to a broader selection of brokers.???

The UK Financial Conduct Authority (FCA) has issued Policy Statement 24/9 entitled Payment Optionality for Investment Research.?The final rules highlighted in PS 24/9 follow the FCA’s Consultation Paper 24/7, published in April 2024 and become effective on August 1 2024.??? Included in the changes to the Conduct of Business Sourcebook (COBS), the FCA has announced that they are “introducing an option that necessitates ‘CSA-like’ arrangements...”?The FCA also recognizes that “...although CSA arrangements may not be a regulatory requirement in other jurisdictions, they are a common operating practice and a frequent choice in research procurement.”? Tourmaline Partners, LLC helps global investment managers and asset owners acquire both sell-side and independent research through the use of bundled and unbundled trading via CCAs, CSAs, attribution and aggregation. We are pleased to see Commission Sharing Arrangement (CSAs) welcomed back in the UK and we look forward to helping the investment community acquire research in a flexible and transparent manner while seeking best execution. To learn more about our CSA offering please reach out to us at [email protected] #outsourcedtrading #buyside #trading #research #commissionmanagement #hedgefunds Tim O'Halloran

Tourmaline Partners, LLC Managing Director Tim O'Halloran shared his thoughts on the growth of Outsourced and Supplemental Trading with Jim Toes, Security Traders Association Chairman, on their May 17th Open Call. On this call, we highlighted Tourmaline’s approach, the industry landscape, as well as the factors driving the institutionalization of Supplemental Trading and leaning on experts.?? “We clearly see this in our global trading business,” said Tim O’Halloran.?“With broker lists down, buy-side traders routinely engage us to source liquidity from brokers with whom they don’t interact directly. While common with small and mid-cap names, which tend to have greater volatility overall, supplemental trading is also being embraced to source block liquidity and trade offshore markets.” Tourmaline Partners provides a strategic lever for buy-side traders to expand their reach, improve trading outcomes and drive investment performance. ???? To learn more or hear the entire STA interview, please reach out to us at the following link. https://lnkd.in/eCSZqAwp ???? #outsourcedtrading #buyside #commissionmanagement #hedgefunds #trading #equityresearch?

Asset managers are increasingly turning to outsourced and supplementary trading relationships to streamline operations and navigate the dynamic regulatory and competitive environment. In the second installment of our three-part series, we delve into the various business models that underpin these trading providers, exploring the expectations of asset managers and the disruptive forces at play in this fiercely competitive realm. Watch entire presentation here https://lnkd.in/eNfTVu_8

Thanks to the Jim Toes, the Security Traders Association and their team for inviting Tourmaline Partners, LLC Partners to their latest Open Call.?It was our pleasure to share our thoughts and observations on the continued growth and institutionalization of both Outsourced and Supplemental Trading.??

Trading offshore markets from North America is a daunting challenge for most investment managers. As the industry’s leading trading solutions firm, Tourmaline Partners sees continued demand to help address this need – it is one of the most common issues we solve for.??? Tourmaline’s unique approach complements a buy-side trader’s existing sell-side resources, providing a single broker contact to a broad panel of overseas brokers with whom they typically don’t engage directly. We have grown to over 20 personnel in our EMEA and APAC offices, 13 of whom are senior traders, averaging over 20+ years of experience.?Our teams face off against over 225 brokers in EMEA and APAC alone, accessing both low- and high-touch solutions.?Our local trading resources – in global equities, derivatives and ETFs – are customized for each client and supported by senior operations teams in all regions. Learn how Tourmaline Partners can expand your path to offshore liquidity, research and market intelligence:?https://bit.ly/3wb9IbU #liquidity, #ETF, #derivatives, #equities #outsourcedtrading #buyside #hedgefunds #trading #equityresearch?????

Demand for outsourced and supplemental trading expertise continues to grow, driven by broader market forces, notably a growth in passively managed assets, increased regulation and a greater use of technology in both trading and research.? ? This complements a noticeable buy-side focus on keeping expenses “right-sized” to AUM, reducing counterparty risk and a keen interest in improving trade workflow efficiencies to drive performance.? ? These trends have fueled a supply of new market entrants. ?? ? Greenwich Associates, in their 2022 Report, A Deeper Dive into the Outsourced Trading Evolution, highlighted that the landscape of Outsourced Trading providers has grown over 400% in the last 4 years and largely settled into three core segments – Independent / Pure Play Providers, Prime Brokers and Custodians.? ? In this growing field of differentiated offerings, investment managers seeking outside expertise must carefully evaluate the outsourced or supplemental trading solution as well as the firm providing it.? ? There is a cadence of questions that we hear often: “Is this a global solution??Can you explain your workflow??How do you seek best execution?”? ? But there is much that should be asked.? ? Perhaps the most important question is “Do you operate like a buy-side trader??Like me??Or am I really just sending all of my order flow to a single, sell-side broker?” ?????Or, “Is this your firm’s core competency?” ? To help with this project, Tourmaline has prepared a due diligence checklist to help investment managers and asset owners know what they don’t know.?We highlight 40 questions to ask any provider.?The questions comprise four key areas of focus - execution capabilities, corporate governance, operational infrastructure and research acquisition capabilities.? ? Now in our 13th year, Tourmaline Partners knows that to achieve success, existing players and new market entrants will require the right team, independent buy-side positioning and most importantly, time to scale.???????? ? Request Tourmaline’s Outsourced & Supplemental Trading Evaluation Checklist here, or reach out to learn more at [email protected].? ? #outsourcedtrading #buyside #commissionmanagement #hedgefunds #trading #equityresearch