News review : Algomi and MarketAxess jockey for position

ALGOMI AND MARKETAXESS JOCKEY FOR POSITION.

Competition is intensifying among electronic bond-trading platforms as they roll out new products that offer greater integration of the technology that is transforming their trading landscape. Trade-data aggregator Algomi launched ALFA, a feature that enables traders to execute trades directly on platforms Liquidnet and Trumid Financial through its own interface. Algomi is hoping to be first to market with a bond execution-management system, or EMS, akin to those that have existed for more than a decade in equity markets.

Scott Eaton the CEO of Algomi said “As a market neutral provider, we are delighted to announce this initiative with Liquidnet and Trumid. Fund managers can now easily action and execute decisions based on the front-end data aggregation we provide. This is a major step in creating an efficient workflow process that leads to trading with increased speed, improved liquidity and efficiency in the market.”

About 60% of US bond-trading desk heads say that currently offered EMSs are fit for equity trading but not well suited to fixed-income markets, according to a study conducted this year by conference operator Worldwide Business Research.

Meanwhile, MarketAxess, the dominant electronic bond-trading venue, launched a new portfolio trading solution for its 1500 client base. The aim is to streamline the trading experience by allowing participants to trade on both price and spread for hundreds of different bonds with flexible negotiation options. It also allows them to submit inquiries to leading liquidity providers for improved competitive pricing and to connect directly to an order management system provider. Last but not least they will gain access to market data and pricing analytics to optimise portfolio pricing and execution quality.

The solution integrates MarketAxess’ proprietary AI-powered algorithmic pricing engine, Composite+throughout the trading workflow. It leverages a universe of over 24,000 bonds from the public FINRA Trade Reporting and Compliance Engine (TRACE) and proprietary data from the MarketAxess trading platform and TRAX. This combination of transacted data from multiple sources improves pricing accuracy for complex portfolios, even with more illiquid instruments.

The new tool will initially be available for price and spread disclosed-trading and will expand into MarketAxess’ anonymous all-to-all Open Trading protocols, bringing further global liquidity options. Portfolio Trading is expected to launch in the Autumn of 2019.

Chris Concannon, President and Chief Operating Officer, said “Improving trading efficiency and the certainty of execution for clients is our top priority. Our Portfolio Trading protocol will help address both priorities by creating a streamlined solution for institutional investors to market and transact large, customised, fixed income portfolios that ultimately demonstrates best execution with competitive pricing and industry-leading analytics.”

©BestExecution 2019

 

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