Order Management Systems / Execution Management Systems

TRADING STRATEGIES, INTEGRATION AND IMPLEMENTATION

A Supplement to Traders Magazine, Produced by SourceMedias Custom Publishing Group

TRADING STRATEGIES, INTEGRATION AND IMPLEMENTATION

EMS and OMS Innovation Abounds

Management systems of both the e and o variety are becoming indispensable tools in traders ever-intensifying quest for best execution. This ourishing sectors rapid evolution is both driving and responding to market dynamics, and its various business models present unprecedented opportunities for traders. Confusion erupted when EMS and OMS providers began delivering similar functionality in their platforms. However, that confusion is giving way to understanding the wide array of choices available. Traders are nding that, despite growing similarities and the emergence of fully integrated platforms, important distinctions between EMS and OMS remain.

Contents

74 76 78 80 82 84 86 88 90 92

Advanced Financial Applications, Inc. Bloomberg Execution Management System Charles River Development Eze Castle Software LLC Fidessa LatentZero Investment Technology Group, Inc. InfoReach, Inc. Portware LLC Townsend Analytics UBS Direct Execution

William Buttereld, TowerGroup senior research associate, points to each systems original goals as an enduring key differentiator. Order management systems, a paper-blotter replacement to track trading activity and orders, are primarily compliance-based. Execution management systems, which originated with day trading and rapidly migrated to electronic institutional trading, are focused on real-time trading, real-time market data, and analytics. Both types of systems have grown far beyond their roots. From my perspective, the choices that are available are outstanding right now, says Robert Hegarty, TowerGroup managing director, Securities & Investment and Insurance. Today, independent EMS vendors and broker-owned EMS platforms are engaged in cooperative competition, propelling innovation to new heights. Typical systems include a trading blotter, connectivity, multiple destinations, and real-time data. Buyside and sellside OMSs are adding EMS-like functionality. In turn, EMSs will continue to innovate, predicts Hegarty. The EMS providers are in a constant state of reinventing themselves and I think that theyll actually do things to try to widen the gap between what they do and what the order management systems do, he says. Many rms employ multiple EMSs and an OMS. Firms tendency to use an EMS or an OMS largely depends on the complexity of the strategy employed and the frequency of trading, according to a January Aite Group research report. As the frequency of trading increases and the per-share expected prot goes down, there is an increase in the importance of

customized functionality. Aite co-founder and managing partner Sang Lee says while its not clear that a fully integrated EMS and OMS is the right solution for most people, The clients have already spoken to a certain degree saying, were interested in having a single platform, a single screen that will help us manage our trading needs. Thats why weve seen a lot of effort on the part of broker-dealers to develop a single-dealer platform and at the same time, adding a lot of new functionality and connectivity. Buttereld offers a different point of view: TowerGroup sees increasing convergence between the EMS and OMS in peripheral functionality but does not expect them to merge into one integrated system because the platforms core offerings serve different purposes and constituents. Ultimately, clients will determine the winning models. With an abundance of choices, they must truly understand their own unique requirements, say the experts, and then determine which solutions best match their trading strategy. Hegarty also advises rms to look beyond each vendors technology and functionality to the stability of the company and soundness of its strategic plan. Aites Lee sees traders becoming more educated and more sophisticated in terms of what kind of tools and services they need to achieve best execution. The rm estimates overall spending on EMS and OMS applications totaled up to about $1 billion in 2006 and that it will steadily increase each year, with a projected $1.2 billion OMS/EMS tech spend by 2010. Most of the clients are actually look-

ing for a platform that can essentially grow with them, says Lee. You see so much emphasis and development effort coming from some broker-dealer EMSs and certainly OMSs who are able to support multiple a set classes across different regions, and different international markets, so that as the client base becomes more sophisticated, theyre able to support that growth and make sure that clients themselves wont have to add another screen just to get another asset class or another international market added to their overall scope. Other factors weigh heavily on decisions as well. Were seeing more of a proliferation of dark pools in the U.S., in North America, and also going forward in Europe with multi-lateral trading facilities, says Hegarty. There will be more pockets of liquidity besides just at the exchanges. Having connectivity to all of these venues will be of great importance for the EMS and OMS providers. Lee points to the chronic demand for measuring performance. It certainly is another product area thats fairly tightly integrated with EMS and OMS to try to gure out, now that weve been given a lot of these sophisticated tools and services, how do we know that were going to get the right type of performance. So tying that back to performance measurement with TCA tools and so on is incredibly important, he says. Another important issue going forward, says Buttereld: Integration between the OMS and the EMS, making sure that data thats entered into one system is replicated and available in the other system in real time.

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Order Management Systems / Execution Management Systems

AFAs Perspective on the EMS vs. OMS Debate

Proability And Performance In Todays Trading Environment In todays environment, protability and performance continue to be the fundamental drivers for traders. Underlying this protability and performance is the ability to access liquidity and execute against it in a cost-effective way. Technology has proven itself, over the last decade, to be a key element in a traders ability to access, execute and manage trades. How a trader decides on which technology to use for order execution and order management is increasingly complex. The industry has seen numerous technology solutions, beginning with the automation of the back ofce some 15 years ago, and the development of order management systems in the 1990s. As traders needs have come to be more precise, technology rms have responded, resulting in trade execution tools (e.g., algorithms, transaction cost analyses, etc.) and order management systems (e.g. trade allocations). In addition, advances in technology (from enterprise software to hosted software) have left many users with legacy systems which continuously need to be either integrated or updated.

One of the great debates revolves around the issue of integrating and migrating trades from front-end execution to back-end clearing and settlement to manage trades throughout the trading process. Most software providers have taken a siloed approach to the process, focusing on one aspect of trading, for example, either an execution management system (EMS) or an order management system (OMS). This is an approach based more in technological capability than on trader need. In this way, the great EMS/OMS debate is irrelevant because it focuses more on the technology than on the underlying forces that drive trading behaviour. The real issue underlying the EMS/OMS debate is not which system is the best but which one addresses workow seamlessly without commingling different applications. Technology Needs to Adapt to Trading, Not the Reverse AFAs approach to technology recognizes this dynamic in trade workow and accounts for trader requirements. Our approach has been to build our technology based on how a trade happens from trade execution to allocation to interactivity with third parties. This approach automates the entire trade workow (execution and processing) and seamlessly allows the user to access all three capabilities via a single, web-enabled application. Another key issue behind the EMS/OMS debate is neutrality and independence. Neutrality is the ability to access multiple brokers, as needed and appropriate, and it means giving the users the ability to control their trades both from trade execution

and trade processing perspectives. This neutrality is tied to the need for vendor independence. As a rm not held by a broker or bank, AFA acts as a strategic vendor with clients, using our client-focused technology to build their businesses. Historically, the marketplace has pigeonholed vendors into either the EMS or OMS category. This is because most vendors have focused their entire business on one specic aspect of trade workow as opposed to the entire trade workow. Given that there is an increasing user demand for an OMS that can also deliver EMS functionality (and vice versa), vendors are now trying to patch together a combined solution, and brokers with captive EMS solutions are trying to work with various OMS vendors. However, this integrating of different applications may serve the needs of the suppliers but is unlikely to be as efcient as one built as a combined EMS/OMS from its inception. Who We Are and What We Do: Simplifying Trade Workow Advanced Financial Applications, Inc. provides a suite of Integrated Order Processing (IOP) solutions to institutions and hedge funds, either directly or through broker--dealer sponsorship. AFAs agship product, IMPACT Pro simplies trade execution and order management. IMPACT Pro is an integrated, truly broker-neutral technology solution that helps clients achieve a seamless trading environment by taking a trade from execution to settlement in a single entry. More importantly, IMPACT Pro provides maximum trading exibility while streamlining trade workow, resulting in lower operating costs for users.

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Pat Lynch
CEO

Nilesh Nanavati
President

Key Features of AFAs Product Suite: US Equities and equity options Ability to access multiple brokers from a broker neutral platform List trading Charting, IOIs and commission management Access to multiple broker algorithms Trade allocations and compliance reporting Automated post-trade reporting to multiple prime brokers Position management and import/export of positions with multiple prime brokers. Key Benets of AFAs IMPACT Pro: Minimum set-up and installation costs FIX-enabled, fully-hosted application Maximum exibility and cost-savings through neutral multi-broker access Operating efciency through seamless trade allocation, middle ofce reporting, and position management Best practice through compliance tools that offer increased transparency. Multi-prime broker connectivity for greater autonomy. No switching costs and lock-ins with service providers Ability to receive orders from other execution management systems. Who We Serve Mid-tier broker dealers nd that their ability to compete with bulge bracket rms is hampered by their inability to offer value-added trading technology solutions to traditional money managers and hedge funds. By offering these rms the ability to provide a differentiated solution (which integrates trade work ow), AFA helps to level the playing eld. At the same time, EMS/OMS needs vary by market segment. Small funds typically are captive to the EMS provided by their prime brokers. As the fund grows to a mid-size fund (less than $1 billion AUM), it requires a exible, neutral application that can allow trading and prime connectivity with multiple brokers. Larger funds ($1 billion plus in AUM) either create something proprietary or invest a signicant amount of money in purchasing a high-end EMS/OMS solution. The fact that AFAs technology solution is built on trade workow rather than specic functionality (such as that related to front, middle or back ofce processes) allows it to service all three segments.

Conclusion The question of where EMS/OMS systems are headed ultimately depends on understanding trade workow and being able to bring efciency (through technology) at each function within that workow. Rather than focusing on EMS/OMS, the industry is better served by focusing on solutions that promote integrated trade order processing while bringing trade workow efciency.

Advanced Financial Applications, Inc. is a nancial services technology company that provides a suite of Integrated Order Processing (IOP) solutions to buy and sell-side institutions. AFA helps hedge funds, asset management rms, broker dealers and family ofces grow their businesses by creating and delivering trading solutions to streamline trade workow, thus resulting in lower operating costs. For more information, visit AFA online at www.afapp.com.

Advanced Financial Applications, Inc. 111 Broadway, Ste 405 New York, NY 10006 www.afapp.com Nilesh Nanavati President nnanavati@afapp.com 212-286-1248

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Order Management Systems / Execution Management Systems

Bloomberg Execution Management System

The wish list of a buy-side trader seems never-ending. Buy-side traders want: a feature set which includes broker neutral access to the most broker, algorithmic and dark pool destinations available; global support on a multi-asset, multi-currency platform; pre-trade cost estimates from leading dealers, working trade analytics, benchmark comparisons in real-time and robust post-trade TCA reports for management reporting and regulatory requirements; to fulll their best execution requirements without conict, with no additional cost to the buy-side and no per customer connectionor trading fees for any participant which ultimately affects commissions and fund performance.

The Bloomberg Execution Management System (Bloomberg EMS), launched in 2005, provides a multi-broker global equity and xed-income trading tool that combines data, trade-blotter analytics and extensive order routing options to Bloomberg users via EMS<GO> on the BLOOMBERG PROFESSIONAL service, at no additional cost to users. Bloomberg EMS buy-side traders can create their own custom trading blotters as well as use the wealth of real-time pre-trade, working and post-trade analytics that can be custom designed, or rely on the vast library of pre-dened benchmarks. The platform also provides a real-time sorting and ltering option that enables traders to identify orders that need special handling versus the selected benchmarks. Orders can be routed to more than 1,000 broker-dealer destinations globally. Pre-Trade Decision Support The extensive analytic capabilities of the BLOOMBERG PROFESSIONAL service are expanded within the Bloomberg EMS service. Bloomberg EMS users see critical market data, % of ADV, VWAP calculations, Natural IOIs, estimated market impact, deviation from benchmarks and custom risk metrics within their EMS blotters. Running the broker ranking application via RANK<GO> on the BLOOMBERG PROFESSIONAL service, users can view the top brokers by volume in each stock, over custom time frames. Broker neutrality reaches beyond routing destinations. Bloomberg provides pre-trade cost estimates from premier broker-dealer providers and allows users to integrate the dealer estimates clients nd useful into their workow. These cost estimates allow users a new way of identifying tough orders; a way that far surpasses conventional methods such as ADV. 76

Additionally Bloomberg provides IOI Live to enable anonymous authentication of Natural IOI size and price to brokers preferred customers. IOI Live caters to the buy-side demand for natural block liquidity and the increasing need to pay preferred brokers. Bloomberg EMS augments this process by matching critical IOI content with the traders orders on their EMS blotter. A buy-side rm can utilize a lter to see all IOIs or Naturals, only from the dealers they trust. Further lters can be utilized to highlight the content on high market impact orders or high % ADV orders all via Bloomberg EMS.

Global Order Handling and Routing Bloomberg EMS provides connectivity to over 37 algorithmic providers and enables brokers to deploy algorithms overnight. Users can be enabled for algorithms intraday, providing a quick turnaround to their client base. Recent enhancements support more algorithmic elds per strategy and more strategies

A Supplement to Traders Magazine, Produced by SourceMedias Custom Publishing Group

Don Carey

Kevin Young

per provider. Bloomberg is an active participant in future development in this space through involvment with the FIX Protocols Algorithmic Trading Working Group. Bloomberg provides breadth, speed, reliability and pricing in Bloomberg EMS, bringing together buy-side and sell-side organizations globally without per connection fees or commissions. With over 1,500 FIX and non-FIX broker-dealer and algorithmic destinations available to EMS, participation is robust in Asia, Europe and the Americas. Bloomberg is committed to continued enhancements to handle and route additional asset classes, as well as integration and connectivity to dark pools and Alternative Trading Systems. Order Management Systems and Workow Integration Bloomberg EMS seamlessly integrates with 3rd party and Proprietary Order Management Systems. Traders typically stage orders from their OMS to the Bloomberg EMS using the widely popular FIX protocol. Orders are received via FIX, scrutinized and sent to the destination of choice. Broker executions are passed to the OMS, automating the process of reaching liquidity. This straight thorough processing greatly reduces errors and simplies trader workow. These capabilities also exist for non-FIX brokers, and have proven signicantly benecial for emerging markets, Latin America and parts of Asia. Bloomberg EMS has powerful and exible import/export functionality. Single orders and baskets can be imported to Bloomberg EMS from MS Excel or text les either through manual drag-and-drop or on an automated basis. Order, trade and audit trail information can be exported on a manual or automated basis out of Bloomberg EMS to be disseminated to back-ofce and prime brokerage systems. Post-Trade Analytics and Transaction Cost Analysis Bloomberg Transaction Cost Analysis (BTCA) provides post-trade transaction cost analysis to analyze broker, trader, market and sector performance, for all transactions through Bloomberg EMS. BTCA combines execution data in Bloomberg EMS with Bloombergs industry standard market data to not only provide statistics on the trading process, but also provide the forensic capability to identify underlying circumstances behind the trade. With multiple benchmarks,trading desk aggregation,grouping, sorting and ltering, reports are fully customizable. Presentation quality reports are available to fund boards, portfolio managers

and compliance ofcers. Detail can be viewed on the order, route and execution level. BTCA is a complete solution for any rm that wants to measure and improve their transaction costs. Bloomberg EMS was awarded Best Execution Management System by Waters Magazine for the second successive year in 2007. With the largest community of users, Bloomberg EMS is a global, broker neutral, stand alone Execution Management System as well as a core component of the Bloomberg POMS platform. Bloomberg EMS is accessible to Bloomberg users via EMS<GO> on the BLOOMBERG PROFESSIONAL service; leveraging all the analytics, routing network, integration and providing post-trade TCA via BTCA<GO> on the BLOOMBERG PROFESSIONAL service.
2007 Bloomberg LP All rights reserved. .

Bloomberg is a leading nancial information services, news and media company. Bloomberg provides real-time news, nancial and market data, pricing, trading, news and communications tools in a single integrated package to customers around the world through the BLOOMBERG PROFESSIONAL service and media services. Bloombergs media services include the global BLOOMBERG NEWS service, the 24-hour business and nancial BLOOMBERG TELEVISION service, BLOOMBERG RADIO services, BLOOMBERG MARKETS magazine and BLOOMBERG PRESS books for investment professionals.

www.bloomberg.com

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Order Management Systems / Execution Management Systems

Stand Alone or Integrated

The Charles River Investment Management System (Charles River IMS) is a comprehensive front- and middle-ofce software suite for all asset classes. It combines state-of-the-art and industry standard technologies to ensure an open, exible system that is scalable, functionally rich, and easy-to-use and integrate. Charles River IMS incorporates real-time electronic trading via FIX through the secure, private Charles River Network based on the BT Radianz global nancial extranet. Comprehensive FIX Network Service includes: FIX trade support; FIX network and software management; FIX testing and certication; and connectivity management

Charles River IMS provides complete trade-cycle support and features several modules to lower costs and risk while increasing operational efciencies, including: Charles River Manager for decision support, portfolio management and modeling Charles River Trader for order management and electronic trading Charles River Compliance for real-time pre-trade, post-execution and end-of-day compliance monitoring Charles River Post-Trade for centralized management of trade matching, conrmation, and settlement workow Charles River TBA Mortgage for automated and streamlined delivery and settlement of MBS pools Charles River Anywhere for secure monitoring and management of Charles River IMS information via any Web-enabled device Charles River Execution Management System (Charles River EMS) for management and execution of orders. The heart of Charles River EMS capabilities is the real-time, user-congurable trading blotter that allows traders to efciently and easily manage and execute orders. Users have access to advanced and easy-to-use functionalities such as user-dened algorithms, proles, strategies, real-time market data, analytics, risk, news and other context sensitive information from a single desktop.

Charles River EMS provides all of the tools buy-side traders need to manage their single stock and list trading processes, including algorithmic trading, pre- and post-trade transaction cost analysis (TCA), direct market access (DMA), automated order routing, access to real-time pricing and market depth and program trading. Algorithmic Trading Easily integrate custom developed sell-side algorithms into the Charles River IMS without the need for additional software upgrades. Access over 200 equity algorithms provided by 30+ algorithmic brokers. Pre- and Post-Trade Transaction Cost Analysis (TCA) Charles River has integrated partnerships with 4 pre-trade and 4 post-trade TCA providers. Integrate pre- and post-trade TCA directly into the order blotter, making data immediately accessible for analysis and routing decisions. Easily navigate to additional value-added content by simply clicking on an individual order within the trading blotter. Direct Market Access (DMA) Charles River has integrated partnerships with 9 DMA providers. Integrated DMA to ECNS, ATSs, dark pools and broker algorithms.

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Tom Driscoll
Vice President Sales and Marketing

Automated Order Routing Route orders automatically by leveraging Charles Rivers advanced FIX auto-routing that evaluates the characteristics of an order as it is being sent and routes with appropriate instructions to the broker of choice. Charles River IMS is completely broker independent, allowing Charles River to route to hundreds of brokers for Algorithmic, DMA, Program or Care orders. Leverage a one-stop point of control and support for EMS and FIX. Route orders to more than 1,200 global brokerdealer destinations that are on the Charles River Network, or to other third-party broker-dealers algorithmic trading offerings or block trading desks. Direct orders to the broker of choice via a single click.

Charles River Development is an award-winning provider of technology systems and services for investment rms in the institutional, mutual fund, banking, hedge fund, wealth management, insurance and pension industries. As of June 30, 2007, Charles River supports more 250 clients in 30 countries with comprehensive and innovative products and services that enhance their business and that of their customers. Recognizing the strategic importance of local knowledge and experience to meet clients needs, Charles River maintains headquarters in Boston, regional ofces in London, Melbourne, Paris and Singapore and has a local presence in major nancial centers around the globe.

Charles River EMS is not EMS light it is a global multi-asset class system that is truly broker independent. Clients have the exibility to leverage Charles River EMS as a tightly-integrated module of Charles River IMS for end-to-end functionality and STP , or as a stand-alone product.
Real-time Pricing and Market Depth Integrated market data via partnerships with Reuters, Bloomberg and 12 real-time data vendors. Monitor real-time pricing directly within the order blotter or leverage data to track implementation shortfall of a particular order or program. Program Trading Create, trade, monitor and update programs. Act on an entire program as easily as a single order. Future Releases Watch Windows for tracking an individual portfolio or individual securities for which no orders currently exist. Trade interactively with complete market depth. Enhanced EMS capabilities for building and customizing user-dened algorithms directly within Charles River IMS. Extended proles and strategies, market data integration, DMA and smart order routing capabilities.

Charles River is recognized as the leading investment management system provider in terms of user satisfaction, cost efciency, reliability and speed. The rm complements its software with a full range of implementation, hosting, remote management and consulting services.

Charles River Development 7 New England Executive Park Burlington, MA 01803 Jennifer A. Duggan, Sales Executive +1.781.238.0099; +1.781.238.0088 fax sales@crd.com

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Order Management Systems / Execution Management Systems

Its All About Workow!

Introducing A Single-System Solution For Order And Execution Management OMS and EMS platforms are converging on the desktop. Its no secret. The buy-side wants it. Industry consultants, vendors, and the press are talking about it. But, the real story, the driver behind this convergence, is workow specically, streamlining the number of steps required to quickly put an order into the market without sacricing functionality. Historically, the OMS and the EMS have co-existed on the desktop linked through a FIX interface. These interfaces, however, have limitations that force the trader to choose either the robust functionality of their OMS or the execution speed of their EMS. The only way to offer traders both the speed they crave and the functionality they need is by going beyond FIX integration and creating a single-system solution. This is the next logical step in the evolution of the OMS.

The Swivel Chair Historically, traders have had a choice of two workows when using an OMS and an EMS; both suffer from the Swivel Chair Effect. In the rst workow, order staging, the trader leverages the functionality of his OMS to generate an order and send it to the EMS. Through the OMS the trader will model the trade, run it through risk and compliance, and pre-allocate it to the appropriate accounts. To stage the order, the trader then lls out a ticket, sends it to the EMS, swivels to the EMS screen, accepts the order, and routes it to the market. In a world where time is measured in milliseconds, this staging workow adds many seconds to the total execution time. Modifying the order is equally cumbersome, requiring the trader to swivel back to the OMS, adjust the order, and then send the change to the EMS where he accepts it and sends it into the market. Failure to follow the proper process can result in a mis-matched order and a broken link between the OMS and EMS.

The second option is what we call Cowboy Mode. In Cowboy Mode, the order originates in the EMS. This workow is fast, allowing the trader to quickly get an order into the market, but it bypasses key functionality of the OMS such as compliance and position checking. In this mode, it is easy to imagine overselling a position or violating a compliance rule and not discovering the issue until after the order is executed. The Challenge With two separate systems on the desktop traders are always sacricing the benets of one for the benets of the other. The challenge is in how to deliver both. We knew with the right approach, the right architecture, and the right expertise, this challenge could be overcome and the OMS could be enhanced to include EMS functionality. Our Approach: A Single-System Solution The key to the approach is putting it all together as one single-system: one blotter, common functionality, with a consistent look-and-feel. For example, in a single-system solution when a trader enters an order directly in a montage it can seamlessly run through compliance and position checking; when he modies the order anywhere in the system it is instantly updated throughout the system. This is possible because its all one system eliminating the challenges of passing information between two different systems created by different companies.

The key to the approach is putting it all together as one single-system: one blotter, common functionality, with a consistent look-and-feel.

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Jeff Gavin
Electronic Trading Product Manager Eze Castle Software

Jeff Shoreman
COO Eze Castle Software

Our Architecture: SOA Eze Castle has been aggressively migrating to an open and scalable service-oriented architecture (SOA) giving our platform the exibility and scale required of a modern OMS. This architecture will allow us to enhance our OMS to include EMS functionality without compromising speed each component or piece of functionality can be tuned and scaled independently. In addition, it allows components of the system, including the EMS functionality, to be upgraded independently. Our Expertise: BNY ConvergEx Group As with any project, you need to have the right people in place to quickly and effectively meet your goals. The execution and buy-side technology expertise across BNY ConvergEx enabled us to bring to market the rst single-system solution in nine months.

The Single-System Solution The Enhanced OMS The OMS is the technology hub of the buy-side. As our clients investment styles have grown more complex, so has our OMS. Since our rst client went live in 1995, we have seen our OMS evolve beyond equity order management to become a multistrategy, multi-asset class system enhanced with functionality to support compliance, commission management, and dynamic prot and loss. Incorporating global EMS functionality into our OMS and extending that functionality to support multiple asset classes is the next natural step in the evolution of the system. Enhancing the OMS by adding global execution capabilities and fully integrated real-time market data is the right way to meet the challenge of delivering both speed of execution and a robust feature set of functionality for the trader. This new paradigm, the natural evolution of the OMS, gives the trader access to EMS functionality in one system, simplifying their workow and streamlining their investment process.

Enhancing the OMS by adding global execution capabilities and fully integrated real-time market data is the right way to meet the challenge of delivering both speed of execution and a robust feature set of functionality for the trader.
Eze Castle Software LLC 12 Farnsworth Street, 6th Floor Boston, MA 02210 (646) 346-1140 sales@ezecastlesoftware.com www.ezecastlesoftware.com www.bnyconvergex.com Eze Castle Software is a leading provider of technology solutions to global investment managers and a member of BNY ConvergEx Group.

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Fidessa LatentZero Launches the Markets First OEMS

by Richard Jones CEO, Fidessa LatentZero Aligned with the quest for fund performance, and with investors demanding more transparency, the execution quality of buy-side trading desks is coming under the microscope. In addition, with growing regulatory pressures in the US, Japan and Asia, and the introduction of MiFID in Europe with its prescriptive client order handling and best execution requirements, the operational control of buy-side trading has also come to the fore. As a result, the buy-side is now demanding broker neutral EMS capabilities fully integrated with the more traditional portfolio management, workow controls and investment compliance offered by an OMS.
Fidessa LatentZeros response has been to create a solution for the buy-side front ofce that can be delivered in two forms: the Fidessa LatentZero EMS workstation; and the fully integrated Fidessa LatentZero OEMS, the markets rst buy-side order and execution management system (OEMS), combining the full power of leading OMS and EMS solutions into a single system. Enhancements made to the broker neutral EMS components are automatically available within the OEMS. Fidessa LatentZero EMS The Fidessa LatentZero EMS is a web deployed market data and low latency trading workstation for equities and equity derivatives, and leverages the software widely deployed by Fidessa on the sell-side. Real-time data is fed from the Fidessa LatentZero ticker plants for 50+ global exchanges, including level 1 and 2 security and index data as well as IOIs, news and graphs. Execution connectivity is provided to over 200 brokers and their associated algorithms as well as DMA to all major global exchanges. The EMS solution, which is used by over 100 rms globally, is ideal for a hedge fund or asset manager requiring out-of-the-box, fully hosted broker neutral market trading, and can be used as a standalone workstation or connected to any OMS, automatically receiving orders and sending back executions. Fidessa LatentZero OEMS The Fidessa LatentZero OEMS is the rst system to provide a complete cross-asset buy-side order management and trading environment. In addition to the market connectivity and trading functions provided by the EMS components, the OEMS includes real-time position keeping and P&L, portfolio analysis and drill-down, order management workows, and investment and trading compliance, and meets the demands of global regulators and MiFID. 82 Support is provided for equities, xed income, money markets, foreign exchange and listed and OTC derivatives. The system can be deployed globally if required from a central server, with the same real-time performance in all locations, which is an important product differentiator for the increasing number of multi-site managers. The Fidessa LatentZero OEMS is used by small specialist managers, through to the worlds largest institutional buy-side rms. Portfolio Management FidessaLatentZeroOEMSprovidesreal-timepositionmanagement and P&L, exposure analysis and drill-down, with exible support for strategies. Portfolio managers and traders can generate orders to suit many investment styles using various techniques across all asset classes, including listed and OTC derivatives. Orders can be executed immediately by a manager/trader, or can be routed to a trading desk located anywhere in the world, 24 hours a day. Pre-trade Analysis The OEMS provides pre-trade order size analysis and transaction cost estimates, as well as IOIs, trade history and news to assist traders in deriving the optimum trading strategy for an order or list of orders. Level 1 and level 2 data is integrated from 50+ global exchanges, and calculated columns with heat maps enable traders to set up their own analytics and alerts. A rules based auto-routing engine enables small or low impact orders to be immediately routed to any trading destination, minimizing delay costs and removing noise from the order blotter, allowing buy-side traders to focus on larger, more difcult orders. Execution Destinations and Strategy The OEMS provides single-click, low latency connectivity from the blotter to the 200+ brokers, broker algorithms and global DMA destinations supported by the Fidessa LatentZero EMS.

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Richard Jones
CEO

Connectivity is also provided to all major alternative trading systems, such as LiquidNet, ITG Channel and Pipeline for equities; TradeWeb, Bloomberg AllQ, MarketAxess and Bond Vision for xed income, FXAll and FXConnect for foreign exchange, and others. Multiple execution destinations can be used for a single order, so for example, a trader could rst look for liquidity in LiquidNet and achieve a 40% match, then place a further 40% of the order on a VWAP algorithm, and use DMA for the remaining 20% to try and achieve some price improvement. Such execution strategies can be saved by traders for re-use. A comprehensive list trading module provides pre-trade list analysis, wave management with access to all execution destinations, and integrated compliance. Fidessa LatentZero OEMS includes real-time execution benchmarks enabling traders to monitor the quality of executions intra-day. Trades can be loaded to third party post-trade transaction costs analysis systems, and a full quote history is retained for quote driven markets, along with hit ratio reports. Operational Control, Compliance and Record Keeping Executions for single and list orders are allocated in real-time to portfolios and strategies according the clients allocation policy, including full commission and charges calculations, with real-time updates to positions, P&L and cash management functions. Commission target monitoring functionality is included, as well as interfaces to trade conrmation systems, and all major back ofce systems providing seamless integration with downstream processing. Tight process controls and permission management within the OEMS, along with integrated investment compliance, greatly reduce the risk of investment or trading errors. Comprehensive mandate, regulatory and management restrictions are supported and checked throughout the investment process, ensuring portfolios stay within guidelines at all times. Order aggregation and portfolio/strategy allocation policies can be dened, which, combined with a full transaction history and audit trail of all user activity, meet the client order handling, record keeping and transaction reconstitution requirements of RegNMS, MiFID and other major regulators. Product Direction An aggressive development schedule is designed to keep the EMS and OEMS ahead of the competition. Current initiatives include, amongst others, a continuous stream of EMS enhancements driven by buy-side customers, and a focus on portfolio management and trading for xed income and credit, interest rate and equity OTC derivatives.

Fidessa LatentZero is a global technology rm that specializes in developing complete front-ofce solutions for the buy-side community. Fidessa LatentZeros Capstone product is used by nine of the worlds largest ten asset management organizations, through to small specialist managers and hedge funds. More than 5,000 portfolio managers, traders and compliance ofcers worldwide rely on Capstone to manage assets in excess of $8 trillion. Capstone is comprised of three components, all of which provide comprehensive functionality for Equities, Listed Derivatives, Fixed Income, Money Markets, FX and OTC Derivatives:

Tesseract for portfolio slice and dice, real-time P&L,

strategy management, modeling, what-if scenarios and order generation.

Minerva OEMS for order management, trading (EMS) and

post trade processing.

Sentinel for pre- and post-trade investment compliance.

Capstone can be installed as a single system, or any combination of modules may be implemented. In addition:

An optional OTC Derivatives overlay module provides

end to end investment workows and pricing for OTC credit, interest rate, ination, equity and currency derivatives across all areas of the Capstone suite.

A standalone, web deployed EMS market data and

connectivity workstation can be deployed for clients requiring out-of-the-box, fully hosted, broker neutral market trading for global equity and listed derivatives. The EMS can be connected to any third party OMS. The Service Oriented, Event Driven technical architecture (SOA/EDA) which underpins Capstone is state-of-the-art and works seamlessly with any other front, middle or back-ofce technology. It provides a 24x7 high performance solution that is scaleable, can be implemented globally and is easily integrated with external systems. Fidessa LatentZero provides expert assistance with system implementation, including technical integration, business process/workow consulting and training. Fidessa LatentZero 1 Alfred Place London WC1E 7EB Ph: +44 (0) 20 7462 4200 Email: info@latentzero.com Web: www.latentzero.com

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ITG Beyond the EMS/OMS Convergence

The true goal of OMS /EMS convergence is to achieve the optimal trader experience traditionally associated with the EMS without sacricing the safety and controls associated with the OMS. To achieve this convergence, many investment managers are using either a vendor who added an EMS to an existing OMS or a multi-vendor solution; however, the use of two systems is inherently inefcient, forcing the trader to ip back and forth.
OMSs were not designed for todays sub-millisecond world of trading and OMS vendors have been slow to respond to the needs of the modern trader. EMSs, on the other hand, handily deliver the required performance as well as the tools needed for best execution; however, they do not address all of the functionality of the OMS, which increases risks and operational challenges. It is clear that an integrated system makes the most sense, but how does one efciently combine all of the functionality a trader requires into one system? The technical challenge is substantial and investment managers must carefully consider each providers consolidation method and experience. ITGs approach is to deliver a single tool for the trader where the historical distinctions between OMS and EMS disappear. ITG is taking the inherent concepts from each world and delivering them as an entirely new application that is optimized for trader workow and performance and allows the institution to better manage the entire pre-trade, trade, and post-trade process with proper audit and control. This new concept, ITG Triton X, delivers unied workow and EMS performance without compromising compliance, cash, or other constraints. Todays traders are faced with increasing demandsto preserve alpha, reduce impact, and generally increase efciencies to minimize costs, while utilizing a multiplicity of systems to do so. Developing a comprehensive tool that spans the required EMS and OMS functions is not easy. Many vendors underestimate the technological complexities of market data management, dealing with trading restrictions, and isolating compute-intensive tasks from highperformance trading activities. ITG is unique in its ability to deliver all of the tools a trader requires, integrating data from throughout the process, as a comprehensive, best-of-breed solution. No other provider offers the same depth of experience or as many proven market-leading solutions. ITG brings to the table years of experience with both OMS and EMS systems. Since its founding in 1987, ITG has developed numerous iterations of its EMS and OMS tools. With each new generation, ITG has improved the traders workow by addressing client-specic concerns with their daily activities using ITGs or other vendors tools. ITG Triton X benets from ITGs years of experience in these areas,including the more than 140 person-years of development effort expended on Triton, one of the leading execution management systems available today, as well as the proven order management capabilities of Macgregor XIP. ITG Triton X melds the best of these applications on a single platform; ITG has carefully selected the technologies best suited to each particular function. Working on a daily basis with traders provides ITG with the years of experience required to properly deal with trading restrictions. The largest asset managers, for example, trade thousands of securities across thousands of portfolios with dozens of rules constraining each one. OMS products have bogged down under this load. The ability to break off slow or compute-intensive functions away from those activities that need to be conducted with speed is only available to vendors like ITG who control, and understand, all aspects of the application. For example, a trader needs to monitor his environment in real-time but doesnt need to immediately conduct allocations to particular accounts. With a unied platform, the allocation process can be off-loaded and conducted elsewhere so that it can occur in a timely manner, but without hindering the traders performance. Data management is another crucial component to delivering a comprehensive OMS/EMS. ITG has been dealing with real-time market data, and its ever-increasing volumes, as well as historical data and analytics for decades. ITG intimately understands the complexities and nuances of efcient data management because our portfolio trading desk, research teams, and best execution tools utilize this data extensively. OMSs are not optimized for the torrents of data needed by todays traders and managers, whereas ITG Triton X makes use of an EMS-like architecture that has been designed to deal with streaming real-time data and provide the necessary scalability and capacity. Finally, client participation and insight can also make the difference in delivering a truly best-of-breed, comprehensive system. ITG services a wide variety of clientsfrom hedge funds trading single stocks to large asset managers managing thousands of orders. Not only is ITG familiar with the unique problems of various types of accounts, the rm relies on its close client relationships for feedback to build and enhance its full range of end-to-end trading solutions.

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Andrew Larkin
Managing Director

ITG Triton X
Only ITG has delivered all of the essential pieces to solving the OMS/EMS puzzleproven EMS capabilities, market-leading pre- and post-trade analytics, a global routing network, extensive intellectual capital, a history of innovative technology, and true neutrality across brokers, liquidity destinations, and vendors. ITG Triton X brings them all together in a cohesive fashion and goes beyond traditional EMS and OMS functions to deliver a unied platform designed to optimize the trading experience and revolutionize order management.
Broker/algorithm/vendor neutral ITG Triton X offers freedom of choice; integrate with your preferred systems, route to any destination, trade with your selected brokers, utilize your algorithms of choice. Proven execution management ITG Triton X leverages the 140+ person-years of development effort behind Triton, one of the industrys leading execution management systems, to deliver fast, proven trading capabilities. Comprehensive trading functionality ITG Triton X seamlessly brings together order management and execution management functionality on one platform designed for maximum speed and efciencywithout staging, re-keying, or data loss. Market-leading best execution tools ITG Triton X seamlessly melds information from throughout the trade lifecycle by integrating marketing leading tools for pre- and post-trade analysis, including ITG Logic and ITG TCA. Portfolio management ITG Triton X builds off the success of the Macgregor XIP PM tool to provide sophisticated modeling, multi-asset class optimization, and integrated pre-trade analytics. Enterprise-class compliance Through ITG Compliance, ITG Triton X offers central management of global portfolio compliance activity with integrated real-time pre-trade monitoring and end-of-day capabilities. Global FIX connectivity ITG NetSM offers ITG Triton X users with global FIX communications direct from the blotter that are fully managed, fast, secure, and reliable. Automated, exception-oriented trade processing ITG Trade Ops automates global post-trade securities matching and settlement communications through tight ITG Triton X integration and Service Bureau connectivity to the industrys post-trade utilities and your nancial counterparties.

Investment Technology Group, Inc. (NYSE:ITG), is a specialized agency brokerage and technology rm that partners with clients globally to provide innovative solutions spanning the entire investment process. A pioneer in electronic trading, ITG has a unique approach that combines pre-trade analysis, order management, trade execution, and post-trade evaluation to provide clients with continuous improvements in trading and cost efciency. The rm is headquartered in New York with ofces in North America, Europe and the Asia Pacic regions. Founded in 1987, ITG was one of the rst rms to recognize the potential of electronic trading and continues to help clients trade more efciently and reduce transaction costs through a combination of technology and client service. ITG has focused on helping clients better navigate an increasingly complex marketplace, starting with the launch of POSIT, an electronic system for low-cost, condential crossing. Recognizing a need in the marketplace for integrated solutions, ITG added pre- and post-trade analytics and multi-asset class order management to its product offering. Nearly 20 years later, ITG remains committed to providing clients with the same high standard of service and innovation. For more information on ITG, please visit www.itg.com.

Investment Technology Group, Inc. 380 Madison Avenue New York, New York 10017 Email: info@itg.com Website: www.itg.com
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InfoReach
InfoReach was founded in 1995. What began as a consulting collaboration has evolved into one of the premier software companies within the nancial technology marketplace today.

Upon completion of that rst consulting project, the companys founders both recognized the signicance of the FIX protocol and the future impact it would have on the nancial industry. They decided to launch InfoReach and one of the industrys rst pre-built FIX engines. For several years, they continued working on in-depth consulting projects for many well known institutions, international exchanges, etc. After many years of consulting and building FIX infrastructures from the ground up, many of our clients began requesting a front-end GUI which can monitor and control orders. Recognizing this need, the company quickly built a tool kit for the rapid deployment of a trading system. This was in essence the birth of todays InfoReach TMS trading platform. In 2002, after many custom deployments, we decided that we had a formidable enough product to compete with the existing vendors and we ultimately made the decision to productize the trading system. Today, we offer two core products, the InfoReach FIX Engine and TMS. We currently are headquartered in Chicago with a satellite ofce in New York that is geared towards sales and marketing. Our philosophy and focus have always remained the same, to build a superior technological product. Our products dont just look good, they are solidly built and well respected within the industry. We are condent that people which are serious about technology and need a product they can trust will call InfoReach. Recently, a major buy-side rm summed our approach up in one sentence We like InfoReach because unlike your competitors, you didnt go out and carpet bomb the industry. Our translation, we didnt go out and bite off more than we can chew. Aside from technology, we realize that service must be superior in order to survive on Wall Street. We have grown the business in a manner which has allowed our products to

evolve while maintaining a high-level of customer satisfaction. Balancing strong technology and customer demands has been the key to our success. The InfoReach TMS was rst deployed in 1997. Through the years our strategy has been to incorporate all customer requested functionality into the TMS. After ten years of development, we have the largest set of functionality offered out of the box. What does this mean to our clients? Most importantly, less functionality has to be developed by programmers, resulting in a quicker deployment at a lower cost. Since day one, we have never charged for set-up of the TMS. The product itself is a broker neutral execution management system capable of trading global equities, options, futures and forex. It is most commonly used buy hedge funds, asset managers and sell-side program trading groups. Users can trade single orders or baskets either manually or algorithmically. Key components would include our custom built algorithms with which we supply our customers the code. The reason we do this is so they could customize our algos to meet their needs with relative ease. The TMS is also integrated with most broker dealer provided algorithms. The combination of proprietary algos and broker provided gives our clients true neutrality with regard to algorithmic trading. Other key components are connectivity to the street via the InfoReach FIX Network, as well as, interactive charting capabilities. Our interactive charting is important to many of our clients because when trading a large set of names it is quite difcult to monitor executions. What we did was create charts which monitor the orders real-time and allow users to interact by trading off of the charts. This is useful because traders can quickly identify and act upon outcast orders, slippages, etc. The

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Allen Zaydlin
CEO

TMS also offers a full suite of pre and post trade analysis tools. These tools are fully integrated with the execution capabilities of the system and allow initiation and control of executions right from the pre and in-trade visual analysis tools.

Users can trade single orders or baskets either manually or algorithmically. Key components would include our custom built algorithms with which we supply our customers the code.
The key differentiating factors of the TMS vs. other similar or competing products is architecture and the amount of functionality it delivers out-of-the-box to trading rms. We have been working on the infrastructure components of the TMS for years making sure we are laying down a robust product foundation capable of accepting future functionality imposed by trading. The character of the TMS was greatly inuenced by initial set of requirements and the vision of the environments it should t into. Namely, it had to be an enterprise-wide solution that can be used by majority of traders in the rm, regardless of their physical location and security types they trade. Therefore, the core of the TMS is its consolidated and scalable server, which consolidates trading activity of each trader and strategy in real-time and it can be scaled across multiple networked computers to handle increased performance requirements. Server-centric technology allows achieving greater performance and reliability as it is decoupled from GUI part that can affect overall performance. When you evaluate execution management systems there is only one fundamental objective you need to keep in mind. An EMS must get you in and out of positions at the lowest possible cost. When you add all cost factors such as performance, price of the product, amount of functionality it makes available, quality of its support and reliability you will nd the INFOREACH TMS is useful for this very reason.

InfoReach is an innovative company focused on providing leading software solutions for the electronic trading of nancial securities.

Established in 1995 InfoReach promptly recognized industry technology trends and created its product line of INFOREACH FIX Engine (FIX protocol engine) and INFOREACH TMS (Trade Management System). Our products are open, scalable and exible solutions for rm-wide order execution and management.

An abundant array of features combined with committed support have made InfoReach the technology of choice for many major buy and sell side nancial institutions.

InfoReach employs a staff of over 30 industry professionals in ofces throughout the United States and Europe.

InfoReach, Inc. 80 Broad Street, Suite 2706 New York, NY 10004 www.in4reach.com Sales 212-269-2722 sales@inforeachinc.com

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Portware The New Age EMS

Staying ahead of the competition requires a central, robust platform that best ts your growing business and technological needs. In doing so, it is important to examine three key factorsFlexibility, Scalability/Performance and Anonymity. All of the above mentioned will allow the buy and sell side trader to take advantage of new opportunities in electronic trading while also allowing them to adapt to changing market environments. Portwares open, exible architecture gives nancial institutions to tools to do just that. It allows for the addition of new functionality and seamless integration with existing infrastructures as well as third party applications such as risk compliance, order management systems, data feeds and networks.

Flexibility Businesses are constantly changing and evolving. Given this, a platform needs to have an open architectureone that allows a trader to implement their own unique ideas while seamlessly integrating with their current environment. This is a system that is truly exible in all denitions of the word, no matter how complex or strict the requirements. Following the traditional trend of broker-developed algorithms, the buy-side now has the capability and means to build their own algos that are more complex and tailored to their specic requirements. Many realize the key advantages from being able to control their ordersthese include lower market impact and lower commissions. Portwares infrastructure allows for easy implementation/ integration with internal systems, proprietary strategies and algorithms. We have certications with over 300 execution destinations, connectivity with the major market data providers as well as complete access to algorithmic suites from over 30 individual brokers. The modern trader now has the ability to control and customize a solution that is unique to them on a platform that meets the high speed requirements of todays environment. Scalability/Performance Speed and capacity become important factors as the electronic trading trend continues. The buy-side is facing rising expectations to increase capacity and capabilities, and the trader is expected to focus on how to best capture expected alpha while minimizing impact. With this demand to control orders comes the responsibility and need to have a platform

designed to handle high frequency and capacity. The execution management system (EMS) has evolved to have both traditional order-entry/direct market access tools as well as an automated environment for the trader. These are gaps that the traditional order management systems (OMS) are not designed to handle. Portware provides a global, multi-asset trading system which supports portfolio, single order and automated trading in an enterprise environment. It gives the trader the ability to once again take control: maintain a complete audit trail with timestamps, benchmark and market snapshots, monitor performance and risk in real-time across many orders, implement their own algorithms, aggregate multiple sources of pre and post trade TCA and IOIs, control their own orders, whether via algos or DMA, and access all available liquidity venues including dark pools. Anonymity The buy-side is now realizing the advantages of having a thirdparty, broker neutral system. It allows them to utilize algorithms developed by the sell-side and route them to any destination. They now have a choice and this means unprecedented control and anonymity over their orders and executionkey information can be kept close to the vest. This issue of visibility comes into play with the many acquisitions by broker-dealers who want to increase their offerings and position. While the two entities are kept independent of each other, for compliance reasons, there is rising concern from the buy-side on the extent to which their order ow is visible. It is important to evaluate how this relates to your business.

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Financial institutions now have the means to control their complex trading strategies and risk while having all information available to them on one, single platform.
Founded in 2000, Portware LLC is the nancial industrys leading developer of broker-neutral, automated portfolio trading software for global equities, futures, options and FX. With ofces in New York, London and Asia, Portware works in partnership with its clients to create highly integrated solutions to streamline workow and increase operational efciencies on
Portware is a leading provider of a broker-neutral trading system that delivers a suite of execution algorithms along with a platform that allows a trader to easily develop their own strategies. The neutrality of the platform also gives unrivalled access to multiple pools of liquidity and unlimited sources of TCA (Transaction Cost Analysis) from one seamless and customizable portal. We have incorporated multiple broker and independent pre-trade cost estimates and post-trade analytics combined with real-time benchmarkingtools for achieving and proving best execution. Users now have a real-time, single view of their trading workow and transaction costs in order to execute trades more efciently, minimize market impact and improve performance. Portware provides a complete snapshot of key points throughout the trade cycle which allows extensive trade analysis of best execution. Financial institutions now have the means to control their complex trading strategies and risk while having all information available to them on one, single platform. When searching for the trading solution that best ts your business, the process can be broken down to a few criteria: exibility, scalability/performance and anonymity. By looking at each key factor, you can uncover the needs and nd a system that makes the most sense. In the end, this crucial decision will help you maintain a competitive advantage over everyone else.

trading desks worldwide.

U.S. Ofce 233 Broadway 24th Floor New York, NY 10279 1.212.425.5233 sales@portware.com www.portware.com UK Ofce 3 Bunhill Row London EC1Y 8YZ 020 7083 7171 sales@portware.com www.portware.com Asia Ofce Level 39, One Exchange Square 8 Connaught Place, Central Hong Kong 852 3101 7676 sales@portware.com www.portware.com

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Is Your Execution Management System Keeping Up?

A Revolution Is Occurring In Electronic Trading Technology And You Cannot Afford To Be Left Behind
The electronic nancial markets are transforming at light speed across both low-touch and high-touch execution models. The regulatory environment is one catalyst leading the charge via MiFID in Europe and Reg NMS in the United States,along with the continued electronic evolution of global markets. Execution destinations are transforming themselves as a result of competitive pressures brought on by operating as for prot entities, through consolidation, improved technology, enhanced functionality and broadening the products and services they offer to market participants. In response, brokers are being forced to provide new products and services such as sophisticated algorithms and more targeted functionalities across a broad range of asset classes to help their valued clients achieve best execution regardless of size or complexity of an order. Institutional traders increasingly require access to multiple brokers based on criteria such as service, content, and expertise. And all the while, quote rates continue to exponentially increase. As a result, trading grows even more complex, requiring new technologies to capture market opportunities as they arise--often in a matter of milliseconds. For many traders, this translates into multiple terminals on their desks, each with a different purpose and content. And many still wonder, cant one common system link them all together in a single trading platform? The good news is that the technology is already available. But to get to where you need to be, you need straight answers from your Execution Management System (EMS) provider on the following: How compatible is my EMS with my OMS? Does the EMS offer the exibility to seamlessly integrate with my OMS? With a multi-broker and multi-asset EMS, does my OMS offer enough exibility to pre-designate broker routes across individual asset classes? How exible is the EMS with various symbologies such as Bloomberg and RIC codes along with proprietary securities identiers used by the OMS? Is my EMS seamlessly integrated with the data and content I need? More and more EMSs have been designed to integrate sophisticated streaming data and value-added content alongside full trading functionality. If you still source the majority of your data and content from an external application as opposed to your EMS, you stay a step behind by introducing a level of human latency into the trading equation. What are the speed, breadth and quality of the data and content I use to make trading decisions? There was a time in the not so distant past when simply the availability of streaming data more than sufced to meet the needs of most traders. Now its not even enough to just keep you in the game. You need data and content of the highest quality and lowest latency if you want to compete with those traders already armed with this. Ask your provider about QPS currently being delivered, their overall capacity and future expansion plans. Find out if their technology is scalable or if they need to rebuild it from scratch. Simply put, if their technology is not state of the art, then you will not be able to achieve best execution. Other questions to ask about your providers data: Where are their data centers physically located? Do they provide hubs in other locations? Do they automatically scrub the data? What connectivity options do they offer to the end-user? Internet, direct feed, nancial extranet? Do they offer full depth of book quote display where available by source? Does the full breadth of data encompass multiple asset classes across global liquidity providers?

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Can I trade multiple asset classes across multiple regions on my platform? Cross-asset strategies are now the name of the game, and the days of single- or limited-asset class terminals are numbered. Exchanges are introducing new products weekly, and the nancial markets are becoming more and more co-mingled across assets. By choosing an EMS that provides a centralized, global view of positions across asset classes, P&L and other critical trading information within a single, tightly-integrated platform, you can ensure best execution, limit risk and reduce mistakes commonly made when trading multiple asset classes on separate platforms. Is my trading platform limited to a single broker or do I have access to a broad network of brokers through a single terminal? Investment managers today engage in multiple brokerage relationships simultaneously, both to preserve anonymity as well as to have access to an appropriate range of specialized products and services. These can include proprietary research, analytics, algorithms and specialized execution services. Thats why a multi-broker, multi-asset trading platform has become one of the primary demands of the buy side. Is my EMS platform truly broker neutral? Being multi-broker doesnt always equate to being broker neutral. To preserve the anonymity of your order ow, ensure that your EMS provider is truly neutral and is not preferencing certain destinations or liquidity pools, and maintains separate locations, staff, infrastructure and networks from that of any other broker on its network. Be satised that controls are in place to provide full broker neutrality to all customers. Summary Thanks to recent advances in technology, what was once thought of as the elusive Holy Grail for traders has become a reality. A multi-broker EMS that can integrate data, news, analysis, direct-access trading and order and risk management tools into a single platform should now be an essential component of the buy-sides trading desk.

If your current EMS provider comes up short in a few of the areas outlined in this overview, its time to consider making a change to the best-of-breed technology you need to thrive in todays global markets. Townsend Analytics invites you to explore how our RealTick EMS can help you maximize trading opportunities, achieve best execution and minimize risk across multiple asset classes. Its the platform of the future...available now. For more information, please visit our website www.townsendanalytics.com or email us at Sales@taltrade.com.
*RealTick is a registered trademark of Townsend Analytics, Ltd. 2007 Townsend Analytics, Ltd. All rights reserved.

Townsend Analytics is one of the worlds premier providers of advanced, integrated capital markets and trading technologies. Townsend offers Trading Services, Content Data Services, Exchange Services, and Portfolio and Risk Services for nancial institutions and investors in over 94 countries around the world. Townsend is the creator of RealTick EMS, the electronic trading industrys premier multi-asset, multi-broker, and multi-route direct access trading platform.

Townsend Analytics www.townsendanalytics.com Sales Sales@taltrade.com.

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UBS Pinpoint Q&A

Will Sterling, Managing Director and global head of UBS Direct Execution, discusses UBS Pinpoint the rms institutional execution management system.
What is UBS Pinpoint, and why did UBS build it? UBS Pinpoint is our next generation desktop trading system. We originally built Pinpoint for our own use on the UBS Equities desks. As we evolved this EMS, we added functionality making it an extremely valuable, user-centric offering. It became both a robust internal system and a valuable, leading-edge platform for clients. We initially rolled it out to our prime brokerage clients, and Pinpoint has grown from there. After just 18 months, we have almost 800 users. Pinpoint is a strong complement to UBSs very open vendor connectivity model. What makes Pinpoint a next generation offering? First, because we created Pinpoint from the ground-up, we created a platform unburdened by legacy technologies. The architecture is designed to be incredibly fast and reliable. Latencies are just 2-3 milliseconds; the overall platform processes over one million orders each day with that performance. Our Pinpoint developers deliver new functionality to our clients every month. Weve chosen not to use a heavy, bureaucratic development model where one plans and analyzes a release for six months, then spends another six months xing the bugs. We have small, frequent releases which mean fewer bugs and quick adaptation to changing client demands. Pinpoint also integrates easily with other systems and is so exible traders can design desktops that precisely suits their unique workow and preferences. What is unique about how you developed this system? At UBS Direct Execution, there is no real distinction between technology and the business. Our traders understand technology, and our technologists understand and often have been traders. So Pinpoint doesnt force traders to accept a developers concept of how they should work. Rather, it gives traders the control to make the system suit their own needs.

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Will Sterling,
Managing Director, Equities UBS Investment Bank

UBS is extremely committed to technological innovation, and invests accordingly. Pinpoint doesnt compromise on the right design a discipline that is sometimes quite challenging, but well worth it in the long run. What do your clients like most about Pinpoint? Our clients love that they can login to Pinpoint anywhere in the world, and are at their own desktop. They like how intuitive the experience is clients control the interface enabling them to customize layouts and execute quickly. They like that, through UBS, they can access over 130 markets across the globe, use the full suite of UBS algorithms, and nd crossing opportunities in UBS Price Improvement Network (UBS-PIN), our own non-quoting liquidity pool. Clients also appreciate that Pinpoint seamlessly integrates with their other vendor systems. A key trend we see among clients is a heightened emphasis on performance and reliability. While new functionality can obviously be useful, clients are increasingly less tolerant of outages and performance issues. Given its speed and reliability, we think Pinpoint is truly differentiated. What about the UBS factor: What impact does UBSs scale and diversity have on the Pinpoint product? Its quite denitely a positive impact. UBS is a global trading powerhouse last year, one out of every twelve shares on every exchange in the world was traded by UBS*. In the US, UBS trades one out of every nine shares. Thats a tremendous amount of liquidity. This deep experience has shaped Pinpoint; we can transfer our go to market expertise to our clients. Pinpoint is also fully integrated with UBSs highly innovative algorithmic trading capabilities. Our clients can leverage the full array of our liquidity-seeking, price-sensitive, and time-sensitive algorithms to execute as efciently and effectively as possible. So what are your strategic goals for UBS Pinpoint? Our objective is to make Pinpoint a market-leading, global, multi-asset desktop trading system. It will evolve to stay ahead of our clients expectations and changing needs. We want to make Pinpoint available to clients who want the same trading functionality and access our Equities traders have. Its not our goal to own every client desktop. UBS Direct Execution has an open connectivity policy. This client-centric philosophy empowers clients to access us however they wish through any of our third-party OMS or EMS partners, or their own proprietary trading systems. All of our Direct Execution offerings can be delivered through Pinpoint or la carte through their OMS/EMS.

You mentioned that new functionality is always being rolled out: how do clients manage installation of so much new technology? Releases are pushed out to clients via the Internet so there are no appointments to schedule, and no trader will lose time waiting for onsite upgrades. The functionality will just be there the next time they login. Release Notes outline what changed and how new functionality has widened their trading capabilities. Whats coming next? What are some of the near-term plans for expanding UBS Pinpoint? Were dramatically expanding our international trading capabilities in August, and by years end, we are adding many new instruments including Futures and FX. Were launching several analytical tools to enhance the trading process such as our pre-trade analytics; our at-market UBS Alerts offering; and our post-trade tools, which provide consultative insights to continuously improve our clients decision making and ultimately execution.

* Per exchange-reported statistics, 2006 Per Autex, 2006 This material has no regard to the specic investment objectives, nancial situation or particular needs of any specic recipient and is published solely for information purposes. This material is not to be construed as a solicitation or an offer to buy or sell any investment instruments, to effect any transactions, or to conclude any legal act of any kind whatsoever. Not all products and services are available to citizens or residents of all countries. No representation or warranty, either express or implied is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the developments referred to in this material. Any opinions expressed in this material are subject to change without notice and may differ or be contrary to opinions expressed by other business areas or groups of UBS as a result of using different assumptions and criteria. UBS is under no obligation to update or keep current the information contained herein. Neither UBS AG nor any of its afliates, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of this material. UBS 2007. All rights reserved.

UBS Direct Execution 677 Washington Boulevard Stamford, CT 06901 Tel: +1-203-719 1750 or +1-800-563 8018 de-sales@ubs.com www.ubs.com

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