Economies of scale create two tiers in FXPB

Big house among smaller houses

Hefty operational costs and thin margins do not generally constitute a winning business model. In foreign exchange prime brokerage – a business that was initially created to meet the needs of hedge funds and is now also bearing the brunt of regulatory change – the two factors have combined to create a two-tiered market where top-tier banks seek to capitalise on their size and smaller players concentrate on tailoring a niche offering.

"I can't overemphasise the importance of scale in this busines

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