Equity market structure Profiles of buy-side investment firms The evolution of multi-asset-class trading Regulation and its implications for markets The search for liquidity in fixed income markets The convergence of fintech and capital markets

Government bond market volatility subsided in May compared to the previous two months, despite a barrage of weak economic data published around the world. In the euro area, the majority of 10-year government bond mid-yields rose slightly during the month, with those for Germany registering the biggest increase of 13.5 basis points to close May at -0.45%. The country’s Federal Statistical Office (Destatis) estimated that the annual inflation rate would fall to 0.6% in May, its lowest level since September 2016.

In contrast, peripheral nations logged double-digit yield declines, with those for Greece and Portugal’s 10-year debt dropping by 64.5 and 31 basis points to finish May at 1.49% and 0.47%, respectively. Their Italian and Spanish counterparts also fell during the month by 27.50 basis points to 1.49% and 22 basis points to 0.49%, respectively. Paolo Gentiloni, European Commissioner for the Economy, identified peripheral...

This past September, Tradeweb Markets took the first steps to address uncertainty with one simple data point: a closing price for U.S. Treasuries. It may sound hard to believe, but, until then, the $16 trillion U.S. Treasuries market, the world’s largest and most liquid bond market, did not have a centralized mechanism for establishing end-of-day prices.

The last several months of record volatility in U.S. Treasuries highlights the need for a benchmark closing price that demonstrates both reliability and accuracy under these extremely challenging circumstances.

What Took So Long?

Unlike equities, where closing auctions at listing exchange determine end of day prices for individual securities, U.S. Treasuries trading is decentralized. This means the individual financial institutions that hold a particular security need to determine their own end-of-day price based on the most recent trades or evaluated pricing...

NEW YORK – June 3, 2020 – Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today reported average daily volume (ADV) of $791.7 billion (bn) in May, an increase of 7.2 percent (%) year over year (YoY).

Lee Olesky, Tradeweb CEO, said: “The combination of robust volumes and easing volatility in May suggests a deeper behavioral change is taking place. As many market participants continue to work remotely, we are focused not only on electronic trading, but on digitizing every aspect of trade processing so our clients can be better informed and more efficient.”

Tradeweb set another monthly record in U.S. credit trading, with ADV in excess of $5.3bn. On May 29th, a single-day record of $4.8bn in investment-grade credit volume traded fully electronically on the Tradeweb platform, representing 11.8% of TRACE volume. Adoption of portfolio trading...

NEW YORK – June 3, 2020 – Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today reported average daily volume (ADV) of $791.7 billion (bn) in May, an increase of 7.2 percent (%) year over year (YoY).

Lee Olesky, Tradeweb CEO, said: “The combination of robust volumes and easing volatility in May suggests a deeper behavioral change is taking place. As many market participants continue to work remotely, we are focused not only on electronic trading, but on digitizing every aspect of trade processing so our clients can be better informed and more efficient.”

Tradeweb set another monthly record in U.S. credit trading, with ADV in excess of $5.3bn. On May 29th, a single-day record of $4.8bn in investment-grade credit volume traded fully electronically on the Tradeweb platform, representing 11.8% of TRACE volume. Adoption of portfolio trading...

How many traders, desk analysts and quants does it take to price a corporate bond? If you were to answer that question even a few months ago, the number could be as high as a half-dozen. Parties on both sides of the trade would be tasked with checking whether the bond traded recently, analyzing current credit and business conditions, digging into individual bond attributes and taking the pulse of the marketplace to see if the other side of the trade agrees with the price. For a complex trade involving a large portfolio of corporate credits, the process could have taken days.

Today, a single trader can do all of that in seconds thanks to advances in machine learning technology which have made it possible to calculate reference pricing in seconds based on dynamic bond market data.

And that is a huge step forward for liquidity in the $9.2 trillion U.S. corporate bond market.

The Corporate Bond Liquidity...

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"Trying to price a large portfolio of corporate bonds such as corporate bond ETFs that provide intraday and instantaneous liquidity in real-time in a volatile market is singularly difficult without significant resources to assist." - Chris Bruner, Head of U.S. Credit

Achieve fast and efficient execution on a large notional trade comprising multiple bonds View aggregate level information on the whole package with Ai-Price, our advanced pricing tool, or the Tradeweb Composite price* Evaluate spread/prices for hundreds of line items Reduce the risk of human error inherent in an Excel-based workflow Minimise information leakage by sending orders directly to a designated portfolio trader Gain additional insights by running Tradeweb’s pre- and post-trade Transaction Cost Analysis (TCA) on your portfolio ###

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The following data is derived from trading activity on the Tradeweb Markets institutional European- and U.S.-listed ETF platforms.

EUROPEAN-LISTED ETFsTotal traded volumeIn April, total traded volume on the Tradeweb European-listed ETF marketplace reached EUR 33.6 billion. The proportion of transactions processed via Tradeweb’s Automated Intelligent Execution (AiEX) tool increased to 67.3%.

Volume breakdown‘Buys’ in equity-based ETFs mirrored ‘sells’ during the month. Activity in the asset class represented 49% of the total notional volume, lagging the previous 12-month rolling average by 11 percentage points.

Adriano Pace, head of equities (Europe) at Tradeweb, said: “Trading activity in fixed income ETFs accounted for 46% of the entire platform flow, a record high. Overall, we saw really strong buying of fixed income ETFs, particularly those offering exposure to corporate bonds.”Top ten by traded notional volumeThere...

The coronavirus pandemic has caused financial services companies, like many other industries, to adjust in record time to new working conditions.From having to adjust to working from home to grappling with the economic consequences of the pandemic, the initial adrenaline rush has worn off and the main decision-makers are shaping what the new normal will look like. Business Insider asked 34 executives across investing, trading, and consumer finance how their business, their industry, and their world would change as a result of the coronavirus. This feature is part of a series based on conversations with more than 200 CEOs on how business will be transformed by the coronavirus. To read more, click here. 

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Following two decades of private ownership, Tradeweb became a publicly traded company on April 4th, 2019 with one of the most successful IPOs of the year. Since then we’ve continued to invest in our people, our network and our technology to improve the way financial markets trade. Learn more in our 2019 Annual Report.

View Report Go

While market volatility was much more subdued in April compared to March, 10-year government bond yields mostly declined, as central banks intervened with stimulus efforts to support economic recovery and stability.

The yield on the U.S. 10-year Treasury fell 7 basis points to finish the month at 0.62%. On April 29, the U.S. Federal Reserve kept the federal funds rate in a target range of 0 to 0.25%, and committed to using the “full range of tools” to help the economy. Unemployment in the country soared, with jobless claims during the pandemic crisis topping 30 million at the end of April.

The European Central Bank also left interest rates and the size of its EUR 750 billion Pandemic Emergency Purchase Programme unchanged, but eased conditions for banks to spur lending, and said it would increase stimulus as warranted. Growth scenarios produced by the ECB suggested that euro area GDP could fall by between 5% and 12% this...

NEW YORK – May 5, 2020 – Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today reported average daily volume (ADV) of $763.4 billion (bn) in April, an increase of 14.6 percent (%) year over year (YoY).

Lee Olesky, Tradeweb CEO, said: “April was a strong month for Tradeweb across all asset classes. Following historic volatility and volumes in March, activity was more normalized but was still higher than any prior April on record. Our clients are adjusting their workflows for the longer term, and we are seeing accelerated adoption of electronic protocols and processing.”

On the final day of April, Tradeweb set one-day records in U.S. Treasury, European government bond and U.S. credit trading, with more than $2.4bn in credit portfolio trading.

RATES

Although regulators have kept the target end-date intact for the LIBOR transition, they have acknowledged that due to the headwinds linked to COVID-19, a few segments of the UK market would not be able to meet some of the interim transition milestones and that all timelines would be kept under review. “The central assumption that firms cannot rely on LIBOR being published after the end of 2021 has not changed,” stated the joint statement on the “Impact of the coronavirus on firms’ LIBOR transition plans” by the FCA, Bank of England and members of the Working Group on Sterling Risk-Free Reference Rates on March 25th 2020. For all intents and purposes, it is business as usual for teams managing the LIBOR transition, with the UK being the furthest along in this process.

Businesses across the marketplace have been working extremely hard over the last few months to deal as best they can with the effects of COVID-19. Clearly, a paramount...

Tradeweb is built on a foundation of strong relationships, product innovation and the power of our global network. Providing a flexible and reliable platform for our clients, especially during periods of disruption and market volatility, is core to everything we do.