"For the buy-side, FlexDMA provides the most direct and efficient path to points of execution," said FlexTrade Systems President, Vijay Kedia. "FlexDMA is a win-win solution for the sell-side and its buy-side clients. Sell-side firms increase the level of trading services they provide to clients and buy-side traders gain more control over their trading, by sending an order directly to an execution destination of choice without it ever hitting a broker's system. Of course, the buy-side can continue sending working or DMA orders to FlexTRADER on the sell-side."

Introduced last year, FlexDMA from FlexTrade Systems is a hosted solution consisting of direct market access servers that enable sell-side firms such as Pulse Trading to expand upon its menu of electronic trading services to buy-side clients. The FlexDMA suite of services include service bureau-based DMA; fully customised strategies; integrated over-the-counter and listed smart orders; flexible internal/external order routing; real time risk management; integrated single stock and program trading; and comprehensive pre-trade as well as post-trade cost analysis.

Pulse Trading has been a FlexTRADER client since 2002. Its clients include large pension plans, money managers and hedge funds. "FlexDMA permits us to provide institutional customers with technology equal to or superior to that found at large Wall Street firms," said Pulse Trading Chairman, Mark Enriquez. "Through a sponsorship with Pulse, institutions are confident that no information leakage or proprietary trading will adversely affect their order flow."

A quantitatively enriched, algorithmic trading and order management system covering equities, foreign exchange, options and futures, FlexTRADER is unique in the marketplace for its organically developed and integrated end-to-end functionality including: pre-trade cost estimation; listed and OTC smart order routing; execution strategies; real time access to full depth of books; and transaction quality management. Well known for basket trading, FlexTRADER is also leveraged for its single stock trading and market making capabilities.

"Our buy-side clients want commissions reduced; they also seek greater control over their trades," said Pulse Trading Executive Vice President, James Willsey. "FlexDMA enables us to answer their demands." Buy-side clients of Pulse Trading submit their orders (market, limit, smart routed) directly to the market centre or ECN of their choice via a proprietary connection to the FlexDMA hosted site.

Apart from FlexDMA, a buy-side trader can continue sending algorithmic, DMA or working orders/lists to a sales trader at Pulse via FIX. Buy-side traders can receive orders into FlexTRADER from numerous portfolio managers, and sell-side firms can receive direct or algorithmic orders from multiple buy-side institutions. Sell-side and buy-side firms can trade orders instantaneously or algorithmically, and send fills as they are received.

In addition to FlexDMA, the company also utilises FlexTQM (Transaction Quality Management) and Portfolio Viewer as tools to enhance their service offerings to buy-side clients. Pulse Trading explained that it will pre-load a test portfolio trade into FlexTRADER at the firm's office, and then demo it at a client site using a Web-based connection to Portfolio Viewer. This approach allows the prospective buy-side client to view the positions and trades "live", as well as review graphs and charts depicting trade impact. Pulse Trading also uses FlexTQM, a suite of tools for evaluating transaction costs during and after trading, to demonstrate their ability to provide pre-trade analysis, cost and impact of a hypothetical trade to a prospective portfolio manager.

Pulse Trading uses FlexTRADER for program, pairs and single-stock trading. Speaking to the utility of FlexTRADER's rules-based system and how it enables Pulse Trading to compete more effectively for order flow from buy-side firms, Willsey said: "With FlexTRADER, I only need one trading system because its rules allow me to trade any number of strategies for a given client. I often remark to clients that if you can think it (a new trading strategy), I can reduce it to an equation and program it into FlexTRADER which is something you simply cannot do without a rules-based trading system. Pulse can offer clients a great deal of trading experience, but FlexTRADER gives us an edge against many bulge bracket firms since we have the flexibility to trade according to strategies demanded by clients and always against the backdrop of providing quality execution."

FlexTRADER is a fully customisable system, with pre-defined trading strategies and tactics for lists as well as single stocks. The ability to easily write and revise customised analytics and quantitative trading strategies within the system makes FlexTRADER a preferred choice among those engaged in agency trading, index arbitrage and other proprietary and standard strategies such as VWAP, transition trading, pairs and long/short trading. This flexibility, for example, gives statistical arbitrage and program traders the ability to act swiftly and with ease in mercurial market conditions, particularly as they look to minimise market impact, transaction costs and risk exposure when trading large, multi-sided portfolios.

From a single, neutral platform, orders are routed automatically to various points of execution including approximately 80 broker-dealers, all leading ECNs and primary exchanges. FlexTRADER's open architecture is configurable for multiple traders over a network, and runs on Sun Solaris, Linux and Windows NT operating systems.