In 2006, JPMorgan, the investment banking team of J.P. Morgan Chase & Co. and Fidelity Brokerage Company, one of the nation's leading brokerage firms, formed a strategic alliance. This alliance made a way for Fidelity's clients to participate in new issue equity and fixed income deals lead-managed by JPMorgan.
In the past, JPMorgan's fixed-income and equity products were distributed primarily to institutions, hedge funds, and "ultra-high-net-worth" investors through the JPMorgan Private Bank. Now, JPMorgan is the primary provider of new issue equity and fixed-income products to Fidelity's clients, brokerage and retail.
The importance of forming the alliance:
1. JPMorgan and it's clients have access to Fidelity's extentsive distribution network.
2. JPMorgan's clients have the opportunity to reach a far broader set of investors.
3. It gives JPMorgan a competitive advantage.
It sounds as if the alliance was a strategic to JP Morgan and only operational to Fidelity Brokerage. Whatever the case may be, it seems to have been a successful venture.
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