RiverRock, an independent alternative investment management company, has launched LinkedTrade, a digital structured products multi-dealer platform, developed by its fintech arm, RiverRock Technology Solutions.

LinkedTrade joins a growing trend in the digital transformation of the structured products industry which is using the latest technology to replace traditional services, automate processes around the issuance and trading of products and deliver efficiencies to respond to clients' needs.

Years ago only investment banks could engineer and issue structured products but since 2003 there has been a significant increase in the number of intermediaries that are working together with investment banks to create their own ideas and get investment banks to issue the products for them to distribute them to their own clients, according to Nicolas Gaumont-Prat (pictured), managing director, at LinkedTrade.

"Those intermediaries - of which there are around 50 or more in Europe, are seen as distributors by the investment banks but some of those firms have also engineering capabilities and they have their own investment solutions," said Gaumont-Prat, adding that the intermediary segment of the market has become under pressure because of new regulatory requirements (Mifid 2), the global compression of margins and the fact that clients expect more services. "We don't think the current set up is sustainable so we are providing a full digital platform aimed at replacing the intermediaries, independent engineering and independent sales so in a way the platform provides a digital structurer and a sales team."

LinkedTrade is a software as a service (SaaS) platform which enables private banks and asset managers to provide their clients with pricing and life management tools and solutions in designing and trading bespoke structured products including suitability assessment, price comparison and lifecycle monitoring

"New opportunities provided by artificial intelligence highlight the need to implement such solutions within our industry," said Gaumont-Prat, noting that fast, highly scalable and can easily be connected and integrated with any in-house systems. "We strongly believe in our ability to help our clients invest in structured products in a brand-new way. The platform covers cross-asset derivatives across pay-off structures and is targeted at private banks and asset managers so their relationship managers can use it as a digital assistant."

The existing structured products platforms in the European market such as Vontobel Deritrade are not seen as competitors as LinkedTrade is "the only independent platform in Europe", according to Gaumont-Prat.

"Other platforms are owned by investment banks and every platform can price the standard products used by private banks such as reverse convertibles, autocalls, and Phoenix structures so the business model is different," said Gaumont-Prat. "LinkedTrade offers that but as an independent provider offering pricing from different providers."

Gaumont-Prat declined to disclose the names of the investment banks plugged into the platform for "competitive reasons".

Speaking about the importance of the digital transformation, Michel Péretié, CEO of RiverRock European Capital Partners, said: "We are absolutely delighted with the launch of LinkedTrade, as part of our strategy to embrace digital solutions in the development of our businesses"

Established in 2009 and headquartered in London and with offices in Paris, Milan and Luxembourg, RiverRock offers a broad range of merchant banking services. RiverRock Securities offers clients diversified capital market products including designing and trading bespoke structured products. RiverRock Technology Solutions is an innovative FinTech solutions provider for structured investments.

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