What happens to stocks if AI loses momentum?
Investing.com -- HSBC Holdings Plc (LON:HSBA), Europe’s biggest bank, is reportedly considering outsourcing a portion of its vast trading business, as the bank’s executives find it challenging to justify the necessary technology investments needed to stay competitive with larger rivals, according to a report from Bloomberg, citing people familiar with the matter.
Preliminary discussions have been held about directing parts of HSBC’s fixed income trading order flow to an external market maker. This move could potentially save HSBC millions of dollars in IT costs related to operating trading desks worldwide.
The bank is open to partnering with firms such as Citadel Securities and Jane Street Group, although the discussions are in the early stages and there’s no guarantee they will result in a deal. Representatives for HSBC, Citadel Securities, and Jane Street have declined to comment on the matter.
The willingness of HSBC to consider such a deal indicates that even systemically significant banks with substantial Wall Street operations are finding it difficult to make the necessary technology investments to compete effectively in trading.
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