Superannuation funds will be able to access a transition management service that is free from inbuilt conflicts of interest following the launch of Instinet’s new offering to the Australian market.
The launch of the capability means the superannuation market can now access pure agency-only transition management services, Instinet head of portfolio implementation and restructuring group Graham Cook said.
“As an agency-only broker, Instinet is free from the inherent conflicts of interest that may encumber other brokers with investment banking, research, proprietary trading and facilitation operations,” he said.
“This is different from ‘agency’ transition managers that claim an absence of conflict by not executing the trades themselves, but in reality are merely separating themselves from the conflict, which then lies with the executing broker and is outside the direct control of the fiduciary employed to manage the transition process.”
Instinet’s full suite of high touch to high frequency trading services will allow clients to track every executed trade, along with the prevailing market price, in both real time and in the final report, Cook said.
“We believe that this level of transparency is the standard that clients should expect from their fiduciaries if they are to be able to properly judge the quality of the trading and conflict management for which the transition manager is responsible,” he said.
“Every basis point saved has a direct impact on the return to super fund members, and the ability to reduce these costs is one of the qualities on which Instinet has built its reputation over its 40-year history.”
