What is Back Office trading?
Business floors are traditionally reserved for activities in Front Office. This is where financial experts meet to create markets in global economies by carrying out trades on behalf of investors. There is also a responsibility that must be assigned to business activities that occur in the Front Office, and many of these tasks, from the settlement and depositing of trades to accounting procedures, takes place in the back off company. The convergence of some of these independent activities has also caused a back office to trade something like reality. Experts who carry out trades on behalf of investors and who interact with clients are important in the front office in a business company. This area is considered a center where the lion's share in the profit of a business company is generated. It is here that shops are carried out from the research and analysis phase to perform a purchase or selling order.
Back Office's business activities are doneKé in financial companies. Back Office experts usually respond to deeds carried out in the front office. It is here that risk management procedures are enforced and accounting procedures are performed. Trades that are carried out on an Office front must be cleaned and settled in a back office and the value of generated trades and profits must be confirmed. It is possible for some Back Office trading features to be externally entered in third -party companies.
Securities lending was designed as a Back Office function. It is here where agreements between two parties are concluded, including the creditor and the debtor. In securities lending, financial security shares are extended to a merchant so that a business expert can bet on a decline in this security or shorten this investment. Borrower offers some type of collateral for stocks.
Transformation on financial markets towards greater publication and greater transparency pushed securities loans from the business function of Back Office to the front office.Not only did the process of approval and facilitate the procedures of securities lending to the forefront of commercial institutions in financial institutions, but also investment experts were moved to be part of the business operations of the Front Office. Basically, traditional trading in the Office was accepted as an activity of Front Office.