The deal is intended to allow the multi-asset and broker neutral order and execution management platform to offer integrated execution, order and portfolio management services.

Both Neovest and LayerOne Financial champion the open platform approach. Once integrated, the enhanced Neovest platform will be available to hedge funds in a modular format.

Users will be able to send orders to their brokers, manage positions, monitor portfolios, and conduct risk assessments and compliance checks from a unified platform.

“Following this acquisition, Neovest can enable clients to manage their full investment lifecycle with one software provider with industry-leading capabilities,” said Jimmi Shah, chief executive officer at Neovest.

“Neovest’s key objectives are creating an exceptional client experience from on-boarding to trade execution management and expanding our product capabilities to advance and differentiate from other investment management platforms. LayerOne’s technology and people are perfectly placed to help us on this journey.”

The completed acquisition is the second announcement to include Neovest in recent months after it also partnered with MAIA Technology to enhance Fulcrum Asset Management’s execution capabilities in December. The pair have partnered to create a joint offering for the asset manager.

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MAIA Technology’s front-to-back platform was already part of Fulcrum’s investment operation and has now partnered with Neovest to benefit from its advanced futures and options execution capabilities.

The move has come as Fulcrum’s trading desk looked to leverage more derivatives strategies and its execution needs evolved. 

The integration empirically means that mutual clients are able to take from both platforms with accelerated onboarding.

Patrick Forde, head of trading at Fulcrum Asset Management, said: “It was important for us to continue to enhance our trading capabilities and find efficiencies, what was equally important was selecting a vendor who would work collaboratively with our existing technology provider. Fortunately for us, Neovest was able to do that.”

MAIA Technology’s front office tools allows for cross-asset functionality across the entire investment management value chain, while Neovest specialises in equities, futures, options and FX markets.

“We are delighted to be able to remove the friction that you often see in this space between vendors and offer our mutual clients’ tools and capabilities that will allow them to focus on their highest priority – growing their assets and delivering value back to their investors,” said Frank Glock, CRO at MAIA Technology. 

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Jimmi Shah will take on the role after joining Neovest two years ago to create and execute on its commercial, client and product strategy.

A multi asset, broker neutral order and execution management platform, Neovest routes orders in stocks and options to more than 360 destination brokers for execution.

The move comes just months after it had to pay $2.75 million to the US Securities and Exchange Commission (SEC) after the regulator accused Neovest of failing to register as a broker-dealer in the first case of its kind in the US. The trading systems provider did not admit or deny the SEC’s findings.

Before joining Neovest, Shah held various leadership roles across strategy, product, FinTech and technology in the financial services industry over the past 17 years.

“Jimmi has played a critical role transforming Neovest into a competitive technology platform in the industry over the past two years, making him a natural fit as the CEO,” said Eddie Wen, global head of digital markets at JP Morgan.  

“I fully expect Neovest to continue to innovate and have sustainable global growth under Jimmi’s leadership.”

Throughout his career Shah has served in several positions at JP Morgan, Morgan Stanley as well as Citi.

“Over the past two years, Neovest has remained focused on executing on our three pillars: keeping resiliency, stability and performance in the platform, creating an exceptional client experience from on-boarding to proactive issue resolution and building new product capabilities to advance and differentiate from other tech platforms,” said Shah. 

“I look forward to the new role as CEO of Neovest to accelerate achievements across all three dimensions to take the team and business to the next level.”

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Neovest operated as a registered broker-dealer prior to its acquisition by JP Morgan in 2005. It routes orders in stocks and options to more than 360 destination brokers for execution.  

According to the US Securities and Exchange Commission (SEC), Neovest withdrew its broker-dealer registration following closure of the deal with JP Morgan but continued to operate its OEMS as a broker-dealer, engaging in order-taking and routing for clients.

The SEC said the platform determined routing options that were available to clients after making agreements with destination brokers and continued to receive transaction-based fees by redirecting destination brokers to JP Morgan, which then transferred the capital to Neovest.

“According to the SEC’s order, Neovest circumvented the regulatory regime that grants broker-dealers the privilege of operating in our markets,” said Joseph Sansone, chief of the SEC enforcement division’s market abuse unit. “Today’s charges underscore the SEC’s commitment to securing the important investor protections that flow from broker-dealer registration.”

Clients of Neovest were deprived of protections that come with using a registered broker-dealer, the SEC added, including regulatory inspections and requirements to have robust procedures and policies in place to safeguard client information.

Neovest has consented to the order and agreed to cease and desist from committing future violations. The trading systems provider did not admit or deny the SEC’s findings, but it has agreed to pay the $2.75 million penalty. The case against JP Morgan’s subsidiary is the first case charging an OEMS platform for operating as an unregistered broker-dealer.

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