Prime Brokers

This article was originally written by Richard Wilson in his Hedge Fund Blog.

Prime Broker Definition
A large bank or securities firm that provides various administrative, back-office and financing services to hedge funds and other professional investors. Prime brokers can provide a wide variety of services, including trade reconciliation clearing and settlement, custody services, risk management, margin financing, securities lending for the purpose of carrying out short sales, record keeping, and investor reporting. A prime brokerage relationship doesn’t preclude hedge funds from carrying out trades with other brokers, or even employing others as prime brokers. To compete for business, some prime brokers act as incubators for funds, providing office space and services to help new fund managers get off the ground.

For more information, see all articles on: Hedge Funds, Performance Measurement, Risk Management, Trading Execution

See also:
  • Brokers versus Dealers
  • Excerpt from Reminiscences of a Stock Operator
  • Exchange Traded Funds (ETFs)
  • Margin Transactions
  • Excerpt from Reminiscences of a Stock Operator
  • Technical Analysis Explained : The Successful Investor's Guide to Spotting Investment Trends and Turning Points

    The Intelligent Investor: The Classic Text on Value Investing

    Financial Statement Analysis: A Practitioner's Guide, 3rd Edition

    Managing Investment Portfolios: A Dynamic Process (CFA Institute Investment Series)

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