Prime Broker

Prime brokers are large institutions that provide a bundle of services to hedge funds and other large financial institutions. Prime brokerage offers a large variety of services which include securities clearing facility, cash management, leverage trade execution, risk management services and much more. Prime brokers mainly earn by charging a fee, such as a spread or premium on the loan from a commercial bank, in return for facilitating the transactions. Prime brokerage services are provided by large financial institutions such as Goldman Sachs, Morgan Stanley, and Paine Webber.