Mostly… fixed income and cross product eTrading

September 17, 2008

More venues than banks..

Filed under: 2015, etrading — holky @ 12:05 pm

A crap week for those in the investment banking space, but should we expect a wave of closure of liquidity venues to hit the headlines shortly? If a third of banks need to dissappear in order to cleanse and rejuvenate the market, surely we are at risk of ending up with more venues than there are liquidity providers to adequately support them? …albeit you could argue were in that space now given a lack of liquidity already.

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4 Comments »

  1. Consolidation is the theme for the next three years.
    Less banks
    Less exchanges/MTFs/ATSs
    Movement of OTC derivatives to exchanges
    Movement of CDS contracts to exchanges (has anyone else seen that banks are now NOT keen on novation – some banks have closed the doors or will charge)
    Less people employed in investment banking

    And a spurt of articles advocating narrow banking…

    Liquidity in the FI space is only at the top end and the bottom end of the market – top notch paper has buyers but anything else is only being bought by vultures offering 50c in the dollar or less.

    Comment by John Greenan — September 18, 2008 @ 8:41 am

  2. What does consolidation mean for FI e-Trading?

    Essentially we have BondVision(MTS), Bloomberg, Thomson Reuters (TradeWeb) and MarketAxess in B2C. In B2B each broker has a system, eSpeed (Cantors), BrokerTec (ICAP), TradeBlade (Tullets) etc plus MTS.

    Single-Dealer systems, having a revival over the pasy year, what does this all mean for them?

    Comment by waratah — September 22, 2008 @ 8:47 am

  3. Not sure about the B2B space, but in the B2C market I cannot see the status quo perpetuating…

    Tradeweb will stay – although with Jim Toffey bailing out the future is less certain. The integration of the Tradeweb pure FI business and the Autex order routing equities piece does not seem to be happening at anything like a reasonable pace.

    MA bought Greenline (great little firm) but I cannot see them as a predator – more like prey.

    Bloomberg – well, they are never easy to work with and don’t appreciate the market dynamics. But they will stay in the market – I believe they are the new owners of liquidity hub….

    Bond Vision – don’t know ’em.

    Predictions
    1. TW may buy Bondvision or MA
    2. Bondvision and MA may merge
    3. Interoperability may appear on the roadmap.
    4. Left field – new entrant comes into the market and cleans up.

    But wtf do I know??

    Comment by John Greenan — September 23, 2008 @ 7:42 am

  4. Interesting that the banks that seem, relatively, solid like JPM, Barclays, Deutsche…..are the better e-Trading houses…….a coincidence? Indirectly maybe not.

    Any news in the FI e-trading world? Everyone seems to have taken a step back from it. Talk of SIFMA conference being canned etc.

    Comment by waratah — October 2, 2008 @ 8:14 am


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