Broker dealers seeking new, high margin products will increasingly look to carbon emissions trading but will need to invest in technology if they are to take advantage of this growing market, according to research from analyst house TowerGroup.
In providing a framework to reduce the global level of carbon emissions and combat global warming, the Kyoto Protocol opened the door to carbon emissions trading, led by such cap-and-trade systems as the European Union Emissions Trading Scheme (EU ETS).
Although these schemes are relatively new and "artificial markets", the battle against global warming is just beginning, says TowerGroup, and government support will ensure the longevity of carbon trading.
Furthermore, as sell-side margins on trading desks compress, broker-dealers will look to cash in on the market....MORE
