DST International (DSTi), a Boston-based provider of investment management and business process management solutions, has signed a joint development and distribution agreement with FlexTrade Systems. The deal allows DSTi and FlexTrade to offer an integrated portfolio modeling, order initiation, and algorithmic routing and execution platform. According to the firms, the new solution, DSTi Execution Management Solution, is the first of its kind available for institutional investment managers on the market today.
DSTi's and FlexTrade's joint development efforts combine the new platform with FlexTrade's transaction quality management monitoring tools. This provides investment management organizations full visibility into trade execution to better examine the quality of the transaction, as well as the ability to monitor the effectiveness of the applied trading algorithms, DSTi (booth 2405) says. Marcus Ansell, president of DSTi North America, says his firm has noticed a significant demand for algorithmic trading in the institutional space over the past year. Consequently, it made sense to partner with FlexTrade.
"After we saw demand increase and talked with FlexTrade about its technology and architecture, it became apparent that FlexTrade's solution would be very complementary alongside DTSi's trading platform, position-keeping and order-initiation capabilities," says Ansell. DSTi Execution Management Solution ultimately empowers asset managers with the ability to specify and control their own algorithmic trading rules, according to Ansell.
"In the past, the only way an institutional manager could really achieve algorithmic trading was to agree with a broker that they would use their proprietary trading algorithm, but it wasn't always clear whether the broker truly followed the process in the way that the investment manager wanted," says Ansell. Because DTSi's valuation analysis complements FlexTrade's algorithmic trading capabilities, an up-sell opportunity exists across the combined client base, according to Ansell.
"FlexTrade was primarily focused on the sell side, ... and historically, we focus on the institutional space, so we feel there are very good up-sell opportunities for both of our customer bases," says Ansell. "DSTi also has a very well-established global network of sales support implementation. With offices around the world, we believe we can leverage the FlexTrade technology into the global marketplace. We believe we will be ahead of the game compared to other trading vendors, especially across the institutional market space."
According to FlexTrade President and CEO Vijay Kedia, the partnership enables both firms to reach many more institutional customers seeking to address the demands of the MiFID initiatives in Europe. "Institutional customers can best appreciate the inherent strength of the new solution to combine the DSTi position management and industrial data warehousing technology with the real-time trade routing and trade optimization capabilities for the FlexTrade suite of products," he says.