By Vineet Naik.
Record trading volumes have been reported across platforms in 2019 despite decreased volatility and challenging market conditions. LiquidityEdge, TradeWeb, and MarketAxess have posted record figures in a variety of instrument classes, with improvements in technology and increased transparency helping them to fight for their market share.
MarketAxess announced its highest-ever monthly trading volumes on its all-to-all platform Open Trading, with a trading volume of US$45.5 billion in January, with an overall trading volume of US$176.5 billion in the same month. On 31 January the firms saw overall trading volume of US$17.9 billion with US high-grade, US high-yield, emerging markets and Open Trading all setting daily records.
“The record January trading volumes are a great sign that market participants are finding increased value from the platform in a variety of market environments,” said Rick McVey, Chairman and CEO of MarketAxess. “Market conditions reversed in January from the fourth quarter, with investors’ increasing exposure to credit products and credit spreads narrowing. It is gratifying to see record daily and monthly volume results in these market conditions following very strong fourth quarter results during a period of challenging market liquidity.”
Continuing the trend was Tradeweb, which has reported record trading activity for February, with new records in average daily trading volume (ADV) in US Treasuries, US Investment-Grade Credit, and European exchange-traded funds (ETFs). US Government Bonds saw an ADV of US$83.9 billion in February, a year-on-year increase of 3.7%, which set a new monthly record for total Treasury trading volume. ADV in European government bonds was also up 13.7% year-on-year. Records were also set in US investment-grade credit and European ETFs, and Chinese bond volumes inched closer to the billion dollar mark, with an ADV of US$957 million.
US Treasuries specialists LiquidityEdge have attributed the intensification of trading activity on their platform to the record number of unique participants benefiting from the directed, disclosed model that LiquidityEdge uses, amongst other factors. They posted record volumes in February, with a high of US$31 billion on 28 February 2019 across both on-the-runs (the most recently issued US Treasuries) and off-the-runs. They also experienced a record week last month, with US$101 billion traded between 21 and 28 February. This was following on from a record month in January, where they recorded an ADV of US$16 billion, representing a rise of 250% from 2018.
Nichola Hunter, CEO of LiquidityEdge said, “This trading data demonstrates that we are successfully challenging market structure and bringing about change in the largest global fixed income market for the benefit of participants. We expect our market share to continue to grow based on our deep customer pipeline and number of clients currently integrating into the platform.”
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