Mostly… fixed income and cross product eTrading

August 17, 2006

Its “Just Another Channel”….

Filed under: etrading — holky @ 6:00 am

I can’t understand why some sellside reps at the etrading seminars – as recent as BMA etrading 2006 (you know who you are!) – are still saying that they “do” etrading solely as an additional service to customers. I and some others on sellside have been publicly saying for years that electronic channels are actually our distribution channel of choice for liquid and commoditised products, as we get scalability (customers and/or number of orders) and with decent onboarding and enablement procedures in place can guarantee better operational control from having less human intervention in the trade lifecycle.

So why isnt everyone openly saying this?  Our collective sellside drive to capture flow electronically isnt detrimental to the customer – this really does offer a win/win. Generally customers don’t want every sellside salesguy they are covered by calling them up to discuss life/footy then ask what trades they want priced, and are happy to have the option of sending their orders, inquiry, bid lists etc through to their chosen banks as and when they want. They trust the electronic venues, and can on occasion be heard proclaiming that with a choice price in tradeweb or bloomberg bbt/allq or wherever, they can even get a good price on their odd lots. Sellside of course get the cost benefits of freeing up their salesguys from the vanilla stuff that can be captured electronically, to focus on giving the customer that killer investment play, based on their deep knowledge of that customers strategy – so genuinely adding value in terms of customer relationship, which (as long as the killer advice is good!) benefits both sides.

Those still saying they are offering etrading as just another channel to offer their customers are clearly missing the point.


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