Bank of America Merrill Lynch will now offer institutional options traders the ability to pay for research and other services through client commission arrangements–CCAs.
CCAs allow an asset manger to execute trades with a broker-dealer and accrue commission credits with that broker dealer for brokerage and research services. CCA’s are typically what people used to refer to as soft dollar agreements. They are also similar to commission sharing arrangements, or CSAs.
BAML’s CCA program falls under the firm’s global commission management business unit, as does its CSA program. All automated trading is integrated with the firm’s global commission products through GCM technology.
“This is a natural progression that marries our low-touch options execution and commission management platforms,” said Bill O’Connor, director Global Commission Management at BoAML. “With the addition of this product, we’re responding to institutional demand.”
In other options-related news, the firm hired J.P. Xenakis as director of electronic options sales. Xenakis will work with the firm’s GCM sales team to introduce the new offering into the options marketplace. He comes from Barclays where he was head of electronic options trading distribution. Prior to that, he was in electronic options sales at Goldman Sachs.
The GCM system supports around 600 clients globally.
The options offering is intended for CCA clients only at this time, according to a spokesperson.
