February 7, 2023

Where Did All the Traders Go? Investment Funds Lean on Outsourcing to Cut Costs

More and more investment funds are outsourcing their trading, a move that cuts costs and aims to boost returns but also poses risks for the funds’ portfolios and underlying investors.

Once a niche Wall Street business that catered to young hedge funds, outsourced trading has now attracted mutual funds, pension funds and other asset managers, including some of the biggest firms on Wall Street that oversee $1 trillion or more, people familiar with the matter told The Information.

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