The purpose of a prime broker is to act as the consolidated portfolio, risk and services account for a hedge fund. Their primary purpose is to allow hedge funds or large investment clients the ability to borrow securities or cash to trade and invest in order to achieve absolute returns. Often hedge funds trade with many different brokers throughout the day who will then "give up" trades to the price broker where the bulk of a funds assets are held. Whilst the prime broker may handle the majority of a hedge funds execution it is normal for funds to spread business across multiple brokerage accounts to ensure that trades are executed with discretion and finesse. Prime brokers also offer access to their client pool for capital introduction to increase the net asset value of hedge funds. This is also common with competing brokers who will want to add value to win execution business to generate commission.

Prime brokers facilitate investment activity on behalf of a hedge fund very often with capital borrowed against the hedge fund itself. As hedge funds can be active with numerous brokers, a prime broker enables greater visibility on performance as all trades are settled through the prime broker. Their responsibilities can vary depending upon what is right for you and your hedge fund.

Examples of the responsibilities of a prime broker can include;

• Online and voice trade execution
• Clearing and give up services
• Securities lending
• Client services
• Risk management and financing
• Reporting and portfolio technology
• Capital introduction
• Hedge fund consulting services
• Bank credit lines
• Research and market timing advice

The best prime broker will be the one that offers the services and features that you need with the fees and payment system that works best for you. Good Money Guide can help you find the right prime broker with our online finder tool. You will have a few questions to answer about the size of your hedge fund, your main investment methods and how often you trade, as well as any additional features that you may require. The finder tool will take about 10 minutes to complete.

Prime brokers are for institutional accounts so there is not a definitive list of prime brokers. However, with our interactive finder tool you can choose from prime brokers which may suit your needs and which can make it easier to choose the best prime broker for you.

The top tier prime brokers are shutting down all their smaller accounts so start up hedge funds need a mini prime broker or mid-tier prime broker.

Our prime broker finder tool can help your start up hedge fund find top prime brokers that are most appropriate for your investment strategy.

If you have a small hedge fund take you can find a mini prime broker here. We work with the best prime brokers for small to medium sized hedge funds that can assist with your trading and fund strategy, including custodian services, regulatory umbrellas, research, analysis and outsourced back office systems. Use our comparison tables to compare the best UK based mini prime brokers authorised and regulated by the FCA. Choose or switch to a mini prime broker that offers the most markets, best pricing and client security.

Prime brokers make money by charging a fee or commission for facilitating the transactions for the funds that they manage. This fee is normally called a "spread".

An FX prime brokerage can offer access to the currency markets around the World at the best prices, as well as funding and clearing services to foreign exchange traders. In addition to the provision of securities, collateral and operational efficiencies there can be many other benefits for forex traders.