Mostly… fixed income and cross product eTrading

April 28, 2008

Charles River rules … ok?

Filed under: etrading, OMS / EMS — holky @ 2:50 pm

Bobsguide says that TradeTech 2008 Names Charles River IMS Best Buy-Side OMS for Second Consecutive Year … Of course thats equity tradetech .. or at the very least now there isnt a FI one, “primarily-equity” TradeTech, though surely nowadays that’s academic; there is a single cross-asset-class buyside opinion on what the best OMS is?

April 21, 2008

Time for CCP in FI Markets?

Filed under: 2015, etrading, Nuts and Bolts — holky @ 12:21 pm

At the same time the exchange markets are moving into a much more OTC shaped model with fragmentation and dark liquidity .. Tabb is suggesting that the Fixed Income industry may need to migrate from a traditional OTC market without a central venue to a more traditional exchange model in which there are not only liquidity providers making two-sided markets but a vibrant agency model as well.   Full article here

With development resource more scarce given current market conditions I think all roads lead to Rome – with Rome being whatever the target client wants it to be. This definitely isnt a one-size-fits-all sort of Rome though. Instead we’ll see continued fragmentation of the existing etrading landscape leading to multiple venues happily co-existing, but each operating with a model specifically aiming at the type of customer they are targeting.  As each trading model brings a different proposition value for each different tiers on client and also on dealer side, it will be interesting to see how many of the existing venues have appetite for revolution to extend their footprint into dramatically new and unproven models (and new target clients), rather than reinforcing what they do by continuing on an enhancement-based evolutionary path – allowing new venues to enter the picture.

Institutional Buyside FI etrading

Filed under: 2015, etrading, FIX, Nuts and Bolts, OMS / EMS — holky @ 12:03 pm

Another post from John Greenan…

What’s the future for Institutional buy-side Fixed Income trading?

Within the e-trading world a lot of the emphasis has been on the sell side with different firms and strategies (Liquidity Hub, project fusion and so on).  One aspect that does not seem to get as much attention is the buy-side.  Typically a big institutional buy-side will have an OMS like Charles River, LatentZero, MacGregor etc.  On top of that will sit one or more of MarketAxess, Tradeweb, BondVision and so on.  The model that these firms impose is one of FIX connectivity into the EMS but no option of end-to-end FIX connectivity from OMS to brokers.

As this market place matures it’s difficult to see what the future direction will be.

I’d like to propose one model.

Buy-side EMS connects via pure FIX 4.4 to a limited number of brokers.  A RFS process starts to request two way quotes in size for a list of instruments that the firm is interested in.  These quotes are combined into a synthetic order book – such that the buy-side can see ‘market-depth’ for instruments of interest.

The strength of this solution is that there is no longer a need to look at proprietary systems, the streamed quotes can be used for monitoring, it’s pure FIX, brokers can be plugged in or dropped without much fanfare.

The weakness is that the first buy-side to implement this may have to build the system.  Potentially it’s a very resource intensive system, depending on the number of quotes, brokers and instruments.

What are buy-sides doing in this space?

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