The Future: What does it hold for IT and Business in Prime Brokerage?

As seen from previous chapters, the business of prime brokerage is unique. Therefore, the future of the prime brokerage industry in business and IT is difficult to predict, given the overlap of the business activities of hedge funds and the investment banks that own most prime brokers, and their dependence on the fortunes of hedge funds.

However, what is certain is that competition in the industry will intensify in the years to come as banks will be vying for a slice of the market and the established players will be under pressure to differentiate their product offerings. In addition, there will be more pressure on the commissions that prime brokers charge and the spreads they enjoy on services such as margin lending and stock loans.