Singapore-based investment manager New Silk Road has outsourced its trading to Northern Trust as it seeks to fortify its offering as T+1 looms.
Yen Leng Ong
Specifically, trading will be provided via Northern Trust’s ITS, which is offered through the institutional brokerage part of the firm’s Banking and Markets segment, which also provides: FX, securities lending, and transition management services.
Yen Leng Ong, country executive, Southeast Asia at Northern Trust, explained that New Silk Road approached the firm looking for a solution “to help navigate cross-border trading challenges amidst a changing market structure in North America”.
Leng Ong added: “By enabling our client-centric solution approach, we determined that our ITS offering was the right fit to provide seamless integrated middle to back-office processing along with efficient trade execution. We look forward to continuing to build our relationship with New Silk Road to enhance their global trading needs.”
Read more: T+1 Industry Issues Forum 2024: Funding and FX challenges
The imminent shift to T+1 in the US is a clear catalyst for this move as Asia-based asset managers expect big challenges due to the time differences.
Northern Trust’s outsourced trading capability “combines worldwide trading expertise in equities and fixed income, exchange traded derivatives, futures and exchange traded funds (ETFs) across global markets,” claims the firm. In addition, the offering includes coverage from multiple trading locations.
Read more: Over half of asset managers do not believe that the T+1 shift will make US equities more attractive
“T+1 introduces significant market timing challenges to investors and managers in Singapore and New Silk Road has a strong understanding of the issues involved in this change,” said Gerard Walsh, global head of client solutions, banking and markets at Northern Trust.
“Northern Trust is very pleased to be working with New Silk Road to ensure their US dollar execution, trade matching, clearing, settlement process, and trade-related foreign exchange are managed as a single lifecycle.”
In addition to the trading services, the firms confirmed that Northern Trust is set to continue to provide global custody services for New Silk Road funds – which it has done since 2011.