In the aftermath of the financial crisis, regulators and financial institutions have begun to scrutinize the financial system’s capital capacity and the creditworthiness of transactional counterparties. Resulting US and international regulations have driven many over-the-counter (OTC) financial products to exchanges and/or Central Counterparty (CCPs) cleared products. Anticipating the changing market landscape, Light Horse MS initiated innovative Peer-to-Peer strategies to provide institutional investors the means to mitigate the rising costs associated with greater regulation and may, in many cases, reduce costs via the introduction of “non-traditional” market participants such as pension funds and corporates.

In the summer of 2009, the Light Horse MS team began to promote listed equity financing solutions, primarily Single Stock Futures (SSFs), to the international money management community.

In June of 2012, Light Horse MS developed the Single Stock Futures liquidity enhancement program, the SSF Jobber. Light Horse MS has been working with a number of multi-billion dollar CTAs to test and implement the program.

In July of 2014, Light Horse MS initiated its Peer-to-Peer stock loan service. By providing a direct conduit to CCP stock loan programs, Light Horse MS’s stock loan service enables managers to achieve increased value of their hard-to-borrow long holdings. By crossing direct interests with other market participants, including many of the larger custodians, Light Horse MS provides clients with beneficial and fully transparent hard-to-borrow pricing.

Capitalizing on the success of the Single Stock Futures market, NASDAQ OMX is expected to launch Single Treasury Futures (STFs) in the 4th quarter of 2014. Light Horse MS is actively engaged in the product’s development and looking forward to providing innovative U.S. Treasury financing, lending and cash management solutions to the market.

In early 2015, Light Horse MS anticipates the introduction of a domestic Central Counterparty (CCP) cleared equity repo platform. Utilizing the firm’s pre-existing CCP stock loan infrastructure, Light Horse MS will provide customers access to alternative sources of funding. Direct access to these cash rich entities can only improve the equity funding landscape.

As a Peer-to-Peer market pioneer, Light Horse MS is dedicated to providing new and innovative solutions to our clients. We believe our efforts have brought a larger and more diverse community of investors into these markets and expect their considerable growth to continue for the foreseeable future.