Mostly… fixed income and cross product eTrading

June 29, 2007


Filed under: etrading, OMS / EMS — holky @ 6:44 am

As electronic trading causes a surge in market data volumes, and buy-side traders seek connectivity to liquidity pools, algorithms and exchange venues that are moving into multiple asset classes, there’s a rising demand on the buy side for execution management systems (EMSs) – says WSJ in an article about this years SIFMA conference

Many order management systems (OMSs) provide access to broker algorithms and operate order routing networks, but they are not as fast as the EMSs, industry sources say. While hedge funds that focus on fast executions across multiple destinations can make do with just an EMS, traditional asset managers still need the OMS, which they use to document trades, rebalance portfolios and handle everything from pre-trade compliance to post-trade allocations.

So the technology providers are pitching integrated global OMS/EMS solutions, taking various approaches to achieving OMS and EMS functionality in a single platform, including acquiring an EMS and merging the two systems, building an EMS on top of an OMS, or building an interface that can connect with third-party OMSs.

And the vendors are placing their bets what the buy side really want; a single OMS/EMS (Eze Castle-ConvergEx, Fidessa LatentZero, ITG Macgregor) or the flexibility to integrate with their favorite EMS (Linedata)

While equity/exchange trading getting its act together in terms of a single buyside entry point to ‘the market’ (regardless of how achieved – above), the status-quo for fixed income remains to use separate application per venue (tradeweb, marketaxess, rtfi, bloomberg, and so on)????



  1. I think we will see a leapfrog effect in Fixed Income. Equity and FX markets have “plowed” a new way. The sell side of FI’s main arguments have always been with the TW’s MarketAxess, etc…single dealer portal is what almost every old school trader wants. The new school would not mind it either…therefore single dealer fix into EMS will be the top of the line for those buy siders who can afford and understand how to install and maintain it (hedgefunds and their disciples). The rest will first maintain the 3rdparty platforms but as their fees ratchet up in the next 2-3 years there will be a flip point there as well to either lining up a few single dealer platforms or using a EMS to organize the single dealer FIX connections. Watch for GS to provide the best GUI’s for single dealer FI via REDI and direct connect anyway a client or could want it… total plug and play. They will do this first and best. The rest will scramble to provide it but not get there for years.

    Comment by lacidar — June 30, 2007 @ 8:41 pm

  2. […] the Mostly blog (good stuff) here – Wall St. & Tech has another article on OMS/EMS convergence in the vendor space. This is a […]

    Pingback by Chris Donnan : Programming - Brooklyn Style - More on OMS/ EMS Convergence — July 9, 2007 @ 2:10 pm

  3. […] With technology increasingly able to consolidate a fragmented market into a single customer view, and the STP benefits of etrading making trade flow fairly predictable once the setup is setup (!), is it such a nightmare on the customer side to use specialists for each area you wish to trade?  Some way to go on this in FI maybe, but the etrading industry generally can do this (as here) […]

    Pingback by The Good The Bad And The Ugly - Next Year « Mostly… — July 12, 2007 @ 7:54 pm

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