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With this in mind, we share below how we approach these challenges by applying our considerable size, global reach, and institutional capabilities to execute your investment decisions.
Source: GIC Monthly View – April 2016
- Challenges are increasing in developed market economies, yet Emerging Market (EM) growth appears more resilient.
- Following the decision by our Global Investment Committee (GIC) to upgrade EM Debt and Foreign Exchange (FX), it has now upgraded EM equities to a small overweight.
- Given the recent market bounce, we have lowered our regional allocation to Europe (ex-UK), as we believe that weak growth and rising event risk may be short-term obstacles to equity performance.
- As a result, we maintain our small overweight positions in equities and hedge funds, with underweights in bonds and cash.
Current trading environment
- When overcoming complex and ever-changing market dynamics, our ability to leverage the expertise and capabilities of our Global Markets division for the benefit of our private clients is of paramount significance.
- In a market with both lower liquidity and rising event risk, we grant access to a wide range of trading strategies, as well as global counterparties and jurisdictions to optimise your market exposure. At HSBC, we work in partnership with you to achieve the most efficient outcome to meet your needs.
- When we look at fixed income, as Exhibit 1 below demonstrates, falling liquidity means it is now more important than ever for you to make use of our wide range of market counterparties and agency brokers to source market liquidity.
- We can analyse the predicted market impact of your order and access multiple trading venues, including Over the Counter (OTC), to achieve the most cost efficient strategy.
- Market impact pre-trade transaction cost analysis allows comparison of various execution factors to help identify the optimum trading strategy for both OTC and on exchange.
- We continue to experience elevated levels of volatility and can work with you to put limit orders in place.
- These are monitored around the clock by our global centres in London, New York and Hong Kong to ensure that you benefit from, or are protected against, significant moves - whenever they occur.
GBP/USD volatility over the last year for 1 month options (Apr 15 – Mar 16):
Why choose us to execute your orders?
- The power of the Universal Banking model allows us to deliver the best of the HSBC Group to our private clients, such as the institutional execution capabilities of HSBC Global Markets.
- When a client submits an execution-only order in a niche area, such as small cap stocks for example, we can send the order to the relevant Global Markets specialist who in turn brings to bear their execution capabilities and years of experience. When HSBC Private Bank clients trade using our execution-only service, they access the market ‘as HSBC’, and this means benefitting from the HSBC Group’s size and scale to achieve optimal pricing.
- We work with you to agree the most efficient way to execute a trade, taking into account the venue, strategy, and optimal way to work your order.
How do we achieve the best price for our clients?
- Smart order routers sweep primary exchanges, dark pools, and Multilateral Trading Facilities (MTFs) to obtain the best price across multiple venues.
- For certain asset classes, we have multiple trading lines in order to procure many quotes, from which the best is selected.
- Straight through processing and electronic trading platforms are used for timely execution.
Want to find out how we can help you?
We have a team of specialists in this area and would welcome the opportunity to discuss your needs further. Your Relationship Manager or Investment Counsellor would be happy to initiate a conversation, so please contact them to find out more.
Our execution capability