The regulatory challenges and cost pressures facing buy-side firms are putting further demands on the sell-side to prove their relationship value. According to conversations with 100 U.S. head traders for the final installment of TABB Group’s 12th annual benchmark study, “Broker Relationships in an Era of Full Disclosure: U.S. Institutional Equity Trading 2016,” on why certain brokers were winning their order flow, 65% of the buy-side mentioned liquidity and 48% mentioned the broker relationship, while just 34% said non-execution services. Compared to 2015 overall, more buy-side firms mentioned liquidity and the relationship and less firms placed importance on non-execution services.
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