Atlantic Equities LLP, the London-based brokerage that provides research on U.S. stocks to European clients, is ending a foray into the greater New York-area market, its chief executive officer said.
The brokerage is closing its office this week in Greenwich, Connecticut, which it formed last year by buying brokerage Execution Noble LLC, Christopher Middleton, the CEO, said today in a telephone interview. Atlantic Equities’s core business is unaffected, and some of the nine U.S. salesmen and traders may be offered positions in London, he said.
Atlantic Equities, which employs about 30 people in London, bought Execution Noble as a way to start marketing its research to institutional investors in the U.S. The business was hampered by low trading volumes, which also contributed to the closures this year of ThinkEquity LLC, Rodman & Renshaw LLC and WJB Capital Group Inc.
“It’s really acknowledging that this route into the U.S. market was going to be a lot more difficult to achieve than we envisaged, despite the best efforts of the team there,” said Middleton, 45, who has led the company since 2003, when he and his team left Cazenove Group Plc.
Small brokerages that makes trades by phone or sell research are finding it harder to earn commissions as money managers buy and sell fewer securities and execute more transactions electronically. Average daily volume for U.S. equities has dropped 36 percent since 2009. The average fee to trade a share of stock fell 31 percent in the period, according to Investment Technology Group Inc.
Ticonderoga Securities LLC, Oscar Gruss & Son Inc., Auriga Holdings LLC, Pritchard Capital Partners LLC, and Kaufman Bros. LP have also fired equity traders or shut their doors this year.