Metals evolution drives Marex Spectron strategy

Jun 04, 2013 | 03:13 PM | Andrea Hotter

Tags  Marex Spectron, Simon Van Den Born, LME, London Metal Exchange, broker, JRJ Group, John Tompkins, Andrea Hotter

NEW YORK — The changing nature of the metals industry has been behind Marex Spectron’s transformation from a transaction broker to a company that guides clients by "creating opportunities through investment in technology and analysis."

The transition of Marex Spectron’s business model began around 2011 following a period of internal analysis, said Simon Van Den Born, the company’s global head of metals. The London-based company determined that metal clients were more likely to be a hedge fund or asset class manager than a traditional vertically integrated hedging company, as had been the case in the past.

Marex Spectron is not seeking to be a pure transactional broker, Van Den Born told AMM in an interview. It also wants to guide its clients by creating trades and opportunities through investments in technology and analysis. "Alpha is tough to find and it’s no longer dependent on doing one thing—say, trading faster, or a single type of trade; that does not get the right combination across your interaction with a market. We can put everything together, from market access to unique market analysis, and correlation across assets to clearing, while I think others struggle with that," he said.

"To have the breadth of products to offer to a far more horizontally structured asset class, we needed to change the way we operated. Our parent, JRJ Group, has been able to morph us from a traditional broking company of the 1990s into a solutions-based transaction house of the 21st Century," Van Den Born said. ....

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