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Template:Unallocatedtrades: Difference between revisions
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[[Asset manager]]s will often proudly declare that they act as [[agent]]: at no time, in no circumstances, can they ever be | [[Asset manager]]s will often proudly declare that they act as [[agent]]: at no time, in no circumstances, can they ever be liable as a [[principal]] for transactions they instruct on behalf of their clients. As a general proposition you can see what they’re trying to say but it isn’t quite that straightforward. | ||
A [[principal]] whose identity is not disclosed by an [[agent]] to a counterparty at the time of transaction is an [[undisclosed principal]]. | |||
Where the [[manager]] instructs the transaction first and allocates it to a given client later — which is usually how managers like to carry on — this puts a [[dealer]] in an invidious position in between times. For a [[dealer]] cannot reject a trade against the street once it has executed it. | Where the [[manager]] instructs the transaction first and allocates it to a given client later — which is usually how managers like to carry on — this puts a [[dealer]] in an invidious position in between times. For a [[dealer]] cannot reject a trade against the street once it has executed it. | ||