“The Adviser integrates information, computing power and human skill to attempt to systematically extract alpha.” – Two Sigma Advisors, LP brochure
On October 17, 2019, Bloomberg reports that “HSBC Considers Equity Pullback in London, New York, Germany.” We used this as a catalyst to add to our ongoing bank-owned broker-dealer modeling.
Here’s a review of Alphacution’s prior analysis in this space:
Alphacution has begun to assemble a composite model on bank-owned broker-dealer operations. Before now, we have conducted the first phase of modeling for:
- Goldman Sachs & Co.
- Morgan Stanley & Co.
- Deutsche Bank Securities, Inc.
- UBS Securities, LLC
- Credit Suisse Securities (USA), LLC
- J. P. Morgan Securities, LLC – formerly known as Bear Stearns & Co.
Among the notable players remaining, we still need to add Bank America / Merrill, Citigroup, Barclays, BNP Paribas and likely Nomura, too. In time, we could expand further from there…
However, given this latest news referenced at the opening, we now add SocGen’s and HSBC’s broker-dealer arms, SG Americas Securities, LLC and HSBC Securities USA, Inc., respectively, to our ongoing monitoring of this story – particularly given what it may mean for the buy-side players, which we first detailed in our all-time most popular Feed post to date, “Top 100 Players in US Listed Market Structure;” a broader story that Alphacution is following quite closely…
Anyway, if we return to the US equity sales and trading market share chart (below) – first published to the Feed here – it’s not difficult to see why HSBC may be considering throwing in the towel in the US, and along with other major financial centers with the exception of those in APAC. They are at the bottom of the league tables, below Deutsche Bank, which was an early towel thrower…
The main questions now are: How pervasive does this trend become among the banks? And then, how do the ranks shift among the banks (and also, between the sell-side and the buyside)?
For now, we’re not going to get too deep in the weeds, particularly since we have yet to add some of the bigger players to the analysis. When we get to those, you will be the first to know. However, as an interim takeaway, consider that the topic here is much more, much bigger than an equities story. For all of these players, this is also a fixed income story as well as an asset management / wealth management story, too. When Alphacution can show how all that is tied together, we will be adding a few sell-side case studies to our library, starting with Goldman Sachs and Morgan Stanley…
Support the Feed!
Note: Business credit cards and bank accounts can be used via our PayPal payment portal.
Alphacution is in the intelligence business.
For those of you who are eager to derive greater value from this work and apply that intelligence to your own business interests, Alphacution is offering unaffiliated individual subscription options priced at $275 per year or $25 per month, cancellable at any time. Both of these options include a rebate on purchases of deeper, more substantive reports and case studies.
In other words, the entire value of an individual subscription paid up to the point of purchasing a single report will be deducted from the purchase of that report. (Rebates not to exceed the maximum value of an annual subscription.)
Enterprise subscription packages for individuals affiliated with trading firms and custom content/service engagement options are available upon request at email@example.com.
Now, for those of you who don’t expect to take advantage of the offers outlined above but want to continue to enjoy the insights, intelligence and occassional entertainment that remain openly available on the Feed, I want to make this specific plea:
Free doesn’t mean there are no costs. In fact, in this case, there have been extraordinary costs in the accumulation of experience and sight, meticulous curation and assembly of data, and creative visualization of and storytelling around our findings.
So, if you value quality content – here or anywhere else – then you need to find a way to support that content at some level simply because you want it to continue to exist. Our post, In Support of Digital Content – which was adapted from other notable digital era content developers – makes a more expansive case for this perspective.
Bottom line: Your efforts to support via one-time or recurring contributions will help guard against this content needing to move from the currently preferred audience-driven model (for its level of independence) to a sponsorship-driven model (which can be found on most other industry media outlets).
So, if none of the subscription options suit you, one-time and recurring support contributions can be made at any level here:
Of course, as always: If you value this work, please continue to “like it,” share it, comment on it – or discuss amongst your colleagues – and then send us firstname.lastname@example.org.
As our “feedback loop” becomes more vibrant – given input from clients and other members of our network, especially around new questions to be answered – the value of this work will accelerate.
Don’t be shy…
Unsubscribe from prior subscriptions without further obligation, at any time, here: