FEATURE
Can platforms transform the UK market landscape? Luma Financial Technologies and asset manager 1OAK have partnered to inject some dynamism into the UK market and help to get the platform message out across parts of the market.
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he two teams have been working for some time to try and find ways to bring automation into a traditional market that has not really had a lot of attention in the past. The US platform chose 1OAK as a partner because of its footprint – it covers around threequarters of the UK market - its infrastructure and the strong market knowledge of its people. “We've been working with them to educate clients and end users of structured products across the market in the UK about the benefits of technology to offer greater access to more bespoke products for a wider section of the market,” David Wood, head of international business at Luma, told SRP.
there is no click to trade, lots of small trades, type of activity,” said Wood. The growth of platforms in the US has been phenomenal – the market crossed the US$100 billion in issuance in 2021, with big brokerages and private banks now using them to deliver and manage products. “We think platforms can transform the structured products market in the UK and will address some of the bottlenecks and problems we have here,” said David Stuff, managing director at 1OAK. “We are targeting investment professionals, discretionary managers, and advisers, promoting the benefits of platforms. We may or may not be involved.”
The initial approach will leave the pure independent financial adviser (IFA) business - the plan manager business – out as that part of the market is “really well set up and served and is not where the interest has come from”.
For example, if a firm has existing distribution agreements with banks, they can deal with banks directly through the platform; 1OAK will help those clients to “get set up and get stuck in”. If firms don't have all the distribution agreements, they can use the Luma platform and 1OAK's distribution agreements.
“The interest comes from discretionary managers who are looking for direct access to ideas and issuers, and go beyond the retail kind of products that they've typically been exposed to because they don't have massive tickets and in the UK market
With its issuer connectivity, Luma will offer managers price discovery, but also the ability to look at product opportunities and help them make better decisions for their clients with some of the analytics the platform offers, according to Wood.
We think platforms can transform the structured products market in the UK David Stuff, 1OAK
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www.structuredretailproducts.com
