Emil Parmar
Director, Credit Trading Solutions, LSEG
As we know, there is a growing trend towards greater electronification across asset-classes and corporate bonds are not to be forgotten. Recently, LSEG spoke with our collaborative partners over at Trumid to discuss this trend and the opportunities and challenges that come with it.
- Global bond markets continue to move towards advanced electronic execution as we see a proliferation of data become more and more available to traders.
- There is a growing need for innovative analytics platforms that can help make sense of the data and convert it into actionable information.
- Recently, LSEG spoke with our partners over at Trumid to discuss this trend and the opportunities and challenges that come with it.
Global bond markets are progressively moving from traditional voice and instant message-based trading to advanced electronic execution. While still a long way from achieving the levels of electronic execution seen in asset classes such as equities, exchange-traded derivatives (ETDs) and FX, there is a clear long-term trend towards greater electronification – as the hunt for liquidity drives more solutions to alleviate the grit from day-to-day trading workflows.
Kevin McPartland, Head of Research, Market Structure & Technology at Coalition Greenwich, sets the scene. “Almost everyone is trading electronically today, including asset managers and hedge funds that have credit strategies. It’s now a matter of starting to use electronic trading in more ways. Maybe firms didn’t use it for high yield, or they would always trade blocks or do their rebalancing over the phone. But now they’re starting to use things like portfolio trading tools and expanding their use of electronic trading for bigger sizes and more complex trades.
Much of this is due to the proliferation of data, explains McPartland. “There’s more data now for bond markets than there ever has been, and the growth is probably exponential. The challenge seems to be less about finding the data, given its abundance, and more about how to use it effectively. How do you aggregate it, pare it, and analyse it so it’s useful?”
This is where innovative analytics platforms can help, by ingesting content from multiple sources including market data providers, trading platforms, and direct streams from market makers, to then convert that data into meaningful, actionable information.
We had the opportunity to speak with Trumid’s Jason Quinn – Chief Product Officer and Global Head of Sales and Mutisya Ndunda – Head of Data Strategy and AI about making sense of data in trading workflows:
JQ: “Pre-trade aggregation of data is a crucial feature in any electronic system. We believe that clients should have access to all the various ways to get trades done electronically. Every trade has different sensitivities, and based on that, you should be able to complete the trade using a workflow that makes the most sense given those sensitivities.”
Read the full article on lseg.com