Moving analysts to the trading desk has proved beneficial at Merrill Lynch.
According to Michael Bird, Merrill’s executive in charge of commission management for the Americas, the decision to place some of its securities analysts on the trading desk has been helpful for both clients and traders.
The program has been “quite successful,” Bird told attendees at a conference put on by AQ Research and Integrity Research Associates.
“It means being able to make short-term objective opinions on the trading desk,” Bird noted, “and also educate traders [about] how news may be relevant to other stocks within the same industry.”
In the past couple of years, a few of the bigger houses have been putting publishing analysts on their trading desks to interact with their hedge fund customers who may trade with shorter-term horizons than traditional money managers.
“It shortens the time from when news hits the tape to dissemination of the effects of that to our clients,” Bird added. “Part of our challenge today is in trying to get out real-time intelligence about how one news announcement affects not just that stock but entire industry groups.”
