Bank of America Merrill Lynch has expanded its global algorithmic platform into Brazil to capitalise on the increasing demand from international and local investors for electronic trading on domestic exchange BM&F BOVESPA.
The algorithmic suite comprises 15 core equity and six core options algorithms, which include volume-weighted average price (VWAP) and implementation shortfall strategies.
Clients can customise algorithms to conform to their goals and benchmark risk tolerance, and use them to express views on alpha horizon, momentum versus mean reversion and stock performance in absolute or relative terms.
“Interest and liquidity in Brazilian stocks have risen significantly this year and as a result our international investor clients are asking for more sophisticated trading tools to access this market,” said Steve Schneider, head of Latin America equities at Bank of America Merrill Lynch. “We are also seeing increasing demand from our local high-touch trading clients, many of whom are now looking forward to using these new trading tools in Brazil.”
Since the merger between Bank of America and Merrill Lynch in September last year, the group has made over 50 specific enhancements to its core algorithmic offering, and now offers a tailored algorithmic suite in over 30 countries.
“We are well-versed in customising our offering for new markets, and relied heavily on local trader feedback when fine-tuning our algos for the BOVESPA,” said Lee Morakis, head of execution services sales at Bank of America Merrill Lynch. “Our clients now have a robust new channel for accessing Brazil’s equity markets, complementing our full-service sales, trading and research operation in Sao Paolo.”