In more than 30 years since its founding, Morgan Stanley Prime Brokerage remains a crucial component of the firm’s Institutional Equity Division. Since inception, Prime Brokerage’s strategy has been simple: a steadfast adherence to being the best possible partner to clients, such as hedge funds, as they launch and evolve their businesses.
We form deep relationships, understand client needs and then deploy extremely high-quality resources where they are needed most,” says Penny Novick, Global Co-Head of Prime Brokerage. “Our brand and reputation are near and dear to us, and the consistency and quality of our offering is rewarded with long-term, trusted relationships. This has and will be our strategy and adds to our durability as well as gives us the ability to constantly enhance our product and the talent behind it. As the needs of our clients ebb and flow, we will adjust to partner throughout their lifecycles.”
Kim Shaw, Co-Head of Prime Brokerage, underscores the importance of tailoring solutions for clients’ diverse challenges in an increasingly complex market environment. “Whether it’s on the alpha-generating side, or helping with running their businesses, or supporting them to evolve with the integration of new technologies—we identify what the problems are, and how can we partner to solve them.”
According to Alan Thomas, Global Co-Head of Equities, the foundation of long-term, sustainable competitive advantage on Wall Street is culture. "What we promote is a culture where we attract smart, ambitious, hardworking people, and then teach them, from the moment they’re recruited, and throughout their careers—that we work together in order to make each other better.”
It is this culture of excellence and partnership that distinguishes the Institutional Equities Division, Prime Brokerage and Morgan Stanley, and one that attracts some 50 to 75 new hedge-fund launches annually, as well as many of the world’s largest established alternative asset managers. “CIOs and founders are reaching out in the very early stages, sometimes a year plus in advance, to provide strategic advice on launching a fund, including structure, timing, potential investor appetite and talent,” Novick says.
When a client selects a prime broker as they launch a new hedge fund, they are engaging a partner, because Prime Brokerage helps these managers set up their businesses, infrastructure, marketing capabilities, and finance and operating models. “It’s about partnering from inception and being able to advise and help navigate the building of businesses, whether on the investment side or non-investment side,” Shaw says.
The Prime Brokerage team also realizes the importance of a strong global footprint, according to Novick. “While we’ve always been global, we’ve been at the forefront of building new capabilities and products for hedge funds and investors around the world, as regional markets have evolved,” she says.