Questions about Prime Broker

J

John_Wensink

I have a committment of 150mm to start my own hedge fund and am looking for advice on a prime broker.

I am leaning on Goldman as I currently use them but wanted to get some feedback on the other shops out there.

Any insight would be appreciated.
 
Quote from John_Wensink:

I have a committment of 150mm to start my own hedge fund and am looking for advice on a prime broker.

I am leaning on Goldman as I currently use them but wanted to get some feedback on the other shops out there.

Any insight would be appreciated.
More...


you need to be more specific.

it depends what you need. every PB offers something different.

surf
 
Sorry,

I just need US equities and a decent platform. I also want them to do the accounting as well and SERVICE.

I dont need extended leverage or anything like that but I do need an acceptable amount of interest to paid in cash as the strategy isn't 100% invested.
 
GS may not be the best choice, as they are one of the largest prime brokers and really cater to the biggest accounts.

There are annual surveys done by Alpha Magazine and Hedge World that break down which prime broker excel in what categories. A smaller prime broker may be better in terms of service and cost for startups.

But if you don't mind extra costs, you really can't go wrong with GS.
 
What's Goldman's threshold? I thought 150 million would satisfy it.

I will check the list you suggested but if I am to attract more money firms like Bear and UBS aren't good selling points because of subprime.

Thanks for the help.


Quote from lwlee:

GS may not be the best choice, as they are one of the largest prime brokers and really cater to the biggest accounts.

There are annual surveys done by Alpha Magazine and Hedge World that break down which prime broker excel in what categories. A smaller prime broker may be better in terms of service and cost for startups.

But if you don't mind extra costs, you really can't go wrong with GS.
More...
 
Quote from John_Wensink:

but if I am to attract more money firms like Bear and UBS aren't good selling points because of subprime.
More...

A lot of firms are having subprime issues. The good thing about BSC is that their prime brokerage business (Bear Stearns Securities Corp) is set up as a seperate company from the main firm (Bear, Stearns & Co). This should help with event risk, don't think other firms have there PB business carved out.
 
Capital base should be good enough for GS, altho you might want a smaller PB for better customer service.

There are many prime brokerages, practically every big bank has one. It's a VERY lucrative business. Lehman, Jefferies, UBS are some other prime brokerages.

Global Custodian has an important prime broker survey but you need to be a subscriber.
Global Custodian
 
Goldman (formerly Spear) is the best overall. They have a solid system (REDI), and are negotiable on rates and debits and credits.

Call Amy Gross on their clearing desk
212-357-7679

Tell her Avi told you to call.
 
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