What Is a Prime Broker?

Prime Broker

A prime broker is a broker or brokerage firm that offers special services to certain clients. These clients often include hedge funds, stock specialists, and other money managers. What these clients have in common is the need to be able to borrow securities or funds in the daily course of business. Most large investment banks offer prime brokerage services to these clients.

The services that a prime broker will usually offer, apart from lending money and securities, include operational support, global custody, and technological tools to allow the client to track portfolio positions. Operational support basically means that the prime broker acts as the agent between the client and all other brokers. The broker is able to do this because of the principal of global custody. This means that the prime broker holds the clients’ assets on their behalf, as well as providing a centralized means for the closing of transactions and for the servicing of assets.

Prime Broker Jobs

Financial professionals who choose to pursue a career in prime brokerage are essentially taking on a role in the hedge fund industry. Whether preparing to be a prime broker who becomes responsible for lending money and clearing the very complex trades executed by hedge funds or taking on a role in the back office where accounting and administration tasks take place, it can all be within the the prime brokerage industry.

Typical tasks that go along with mortgage broker jobs include researching different banks’ policies and rates for mortgages, analyzing paperwork and terms on clients’ mortgage loans, negotiating for more competitive rates and gathering paperwork and passing it on to other professionals in the mortgage financing industry for underwriting and approval. Since mortgage brokers’ jobs involve giving a fair amount of financial advice to individuals, especially those new to the mortgaging industry, they can be held accountable for what they say.

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