July 31, 2008
Pipeline Racks Up Huge Savings for Buy-Side Block Traders — Elkins/McSherry
Elkins/McSherry, a leading provider of customized trade execution analyses, recently completed a three-month study of the performance of Pipeline's block execution system. The system combines The Block Market(TM) and Pipeline's new Algorithm Switching Engine(TM). The study showed Pipeline's customers saved 5 cents in total cost as compared to the average of the Elkins McSherry universe of brokers.
The Algorithm Switching Engine represents a dramatic enhancement to Pipeline's original block trading capabilities. It incorporates proprietary predictive analytics to manage access to over 100 third-party algorithms, harvesting liquidity from over 30 dark pools and all the displayed markets. The combination of the Switching Engine and The Block Market enables large institutional customers to completely execute block orders, achieving best execution by minimizing the amount of information leaked to predators.
"These implementation shortfall results are especially significant because they reflect not only the zero-impact savings from blocks executed immediately upon entry, but also the savings achieved by our community as they use the Switching Engine to drive block orders to completion through dark pools and other markets. Our block execution system is enabling Pipeline traders to significantly outperform their peers, even on orders that aren't lucky enough to execute when entered," said Fred Federspiel, president of Pipeline.
The Elkins/McSherry result is independent of any pre-trade market impact model, and instead compares the actual results of orders executed by institutional traders. The savings reported include both the effect of Pipeline's $0.02 commission, and the reduction in observed implementation shortfall.
Pipeline partners with block traders to optimize the execution of giant orders while denying statistical arbitrageurs the information they'd need to take advantage of institutional orders. Pipeline is the only block execution system that combines the high probability of block liquidity with the unmatched performance of predictive switching between best of breed algorithms. It was built from the ground up to deliver impact-free block liquidity in the face of increasingly sophisticated predators. Pipeline is headquartered in New York with offices in Boston, Chicago, and San Francisco. For more information, visit http://www.pipelinetrading.com.
Elkins/McSherry, a leader in the global financial consulting industry, provides customized trade execution analysis reports that are used as an independent monitoring and management tool. The Elkins/McSherry Trading Costs Analysis gives institutional investors a complete evaluation of trading cost for both equity and fixed income securities. Its process is designed to create a comprehensive, 360-degree examination of trading costs.
Contact: Brian Holland Pipeline Financial Group, Inc. 212-370-8326 Email Contact Bill Haynes BackBay Communications 617-536-0246 Email Contact
SOURCE: Pipeline Trading Systems