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Squeeze Play at Robeco

Traders Magazine, September 2005

Michael Scotti

Pension funds don't like paying for brokerage research these days. And that has pushed firms like Robeco Investment Management to rethink the way in which they reward their brokers with commissions, according to Mark Kuzminskas, director of trading in Boston and New York for Robeco, a firm that manages $25 billion in equities. "Clients are indirectly saying they don't want us to pay for Street research," Kuzminskas says. He says that's because discounted commissions-in the form of rebates that pension funds get refunded through commission recapture programs-are rising. Pension funds are either starting recapture programs or are increasing their level of recapture, he says. About 20 percent of Robeco's business is directed by clients to brokers who provide them with a rebate.

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