Stock Loan Services


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The advent of Central Counterparty (CCP) cleared stock loan programs has enabled financial institutions to optimize their counterparty exposure. Light Horse MS has endeavored to bring the benefits of these programs directly to our clients. By providing the infrastructure for access to the Central Counterparty cleared stock loan programs, beneficial owners and short players can interact directly with each other without concerns for creditworthiness. Light Horse MS clients are now afforded access to the same universe of stock lending counterparties as traditional market participants, but at a fraction of the cost.

In addition to providing direct access to the stock loan wholesalers, Light Horse MS’s stock loan team can also assist clients in monetizing the value of their long holdings or reducing the cost of their borrowings.

Light Horse MS offers two categories of premium stock loan service to its clients:

General Collateral: Peer-to-Peer stock loan financing transactions that provided true stock loan cash-flows to lenders and borrowers. Prime brokers currently earn up to 60 bps (.60%) on an internal stock loan transactions. By confidentially matching long and short positions directly, Light Horse MS helps customers collapse this funding gap to as low as 10 bps (.10%). The resulting loan provides advantageous funding levels for the long holder and pays the short holder an appropriate return on its cash collateral.

Hard-to-Borrow: Traditional hard-to-borrow portfolio optimization via prime broker internal pool of assets, AQS, externally sourced stock loan (often via the OCC), and peer portfolios. Light Horse MS team assists managers in identifying their most valuable long assets or costly borrows for servicing. Utilizing internal and external resources, the Light Horse MS team then actively manages the client’s lending or borrowing activities to maximize portfolio returns.