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Strategic investment units driving the evolution of trading

Banks have been working together for years to fund important new trading companies, and they are not all that concerned about making a return

Strategic investment units driving the evolution of trading
Photo: Getty Images

Hidden away within the trading divisions of most major investment banks are a small group of people constantly hunting for the next big thing in market infrastructure.

These low-profile units, often called "principal strategic investments", use a bank's own capital to take long-term, minority stakes in trading venues and clearing platforms, as well as data and compliance utilities.

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