Research and advisory firm Celent has released a new report, titled, The Evolution of Sell-side Equities Technology Practices. Authored by Arin Ray, an analyst with Celent's Securities and Investments practice, the report says that ever-present competition, stringent regulations, and weak trading volumes are leading to poor economics for sell-side firms in equities trading. Since these firms have already taken measures to reduce capacity in the short run, it is now time to undertake a radical review of their IT strategy.

In the report, Celent says it identifies and discusses emerging technology practices to enable cost reduction in equities trading for sell-side firms in the long run. The US economy has been on a path of slow but steady recovery since 2009-2010, but equity trading volume is still significantly down compared to the levels seen in 2007-2008 due to persistently low volatility. With a radical departure from this trend unlikely in the near future, sell-side firms should address overall technology strategies with a longer-term view.

Celent believes sell-side firms should focus on their core business by looking to reduce in-house involvement for non-differentiating activities through outsourcing to external providers.

Outsourcing is not new to the industry, but its adoption has been expedited in recent years due to changing market conditions. Sell-side institutions that previously outsourced smaller pieces of technology are increasingly looking to engage with external providers under a "managed service" model, where the provider is responsible for building and maintaining different aspects of operations on an ongoing basis. This is emerging as a popular model, especially among small and midsize sell-side players.

“In the last six to 12 months, we have seen the emergence of the utility model, a highly standardised offering built by a third-party provider and offered on a pay-per-use basis to a broader segment of the industry,” says Ray. "The utility model is still in its early days and is seen in modular offerings in areas such as KYC registry and collateral management. This model, through achieving industry-wide common standard and economies of scale, has the potential to reduce costs for the industry as a whole and therefore promises to be a significant step forward in the evolution of sell-side technology practices.

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BNY Mellon has issued a formal statement regarding the findings of a UK Financial Conduct Authority (FCA) investigation into compliance with relevant FCA Principles and UK Client Asset Sourcebook (CASS) rules during the period from November 2007 to August 2013.

Cantor Fitzgerald says it is expanding its asset management business. 

Working with Euroclear UK & Ireland, Northern Trust has enhanced its processing capabilities for investment fund transactions in the UK, improving accuracy and increasing efficiency.

State Street has promoted Alex Lawton to be senior managing director and head of securities finance for State Street Global Markets in Europe, Middle-East & Africa (EMEA).