Salerio launches system to help managers automate post-trade processes
Salerio, a post-trade management technology specialist, has launched a product developed for buy-side firms, including hedge funds, which currently have little or no automation in their post-trade operations.
Salerio Connect integrates with financial messaging provider SWIFT - through its SWIFT AllianceLite 2 programme – to enable messaging capability and trade confirmation before sending trades to prime brokers, which should help hedge funds curb their operational risk and reduce processing costs.
“The software ensures asset managers deliver quality information for their brokers to work with. This should ensure a hedge fund’s risk profile is improved, which could play a part in institutional investors deciding in whose hands to entrust their money,” said Ken Skehan of Cor Financial, Salerio’s parent company.
The system will help lower the risk of a trade mismatch being uncovered at the Central Securities Depositary (CSD) stage in the post trade settlement process, thereby mitigating the risk of a trade failure.
“The move to harmonise European settlement dates at T+2 will add significant pressure to both parties to reduce the number of mismatched and failed trades, as the associated costs of contractual settlement, a key prime broker service to hedge funds, could be in danger of spiralling upwards,” said Phillip Chapple, managing director at KB Associates, a boutique hedge fund consultancy in London.
Given that the system helps reduce risk, Skehan argued costs could be offset to the fund.