Buy-side Perspectives Issue 14 - Page 10

The hurdles race - taking fixed income trading to the next level directly with electronic market makers for certain types of flow. Bond trading counterparties We had an interesting debate and researched in depth about the preferred counterparties for Emerging Markets and High Yield in London, Paris and Frankfurt. There are still development opportunities in how banks are advertising emerging markets flow electronically on platforms. The buyside have identified that the lack of advertised EM flow electronically is partially due to internal sales recognition issues where the EM sales person in the specific country may not get recognised for their efforts if the trade is executed on a platform. Reviewing the concentration of preferred counterparties for various types of trades in the bond market, some major brokers are increasingly successful in smaller electronic enquiries due to their investments in algorithmic quoting. A few buy-side firms have also started trading bonds 10 Trading technologies There are still growth opportunities for the buyside to leverage and trust all-to-all trading to access buy-side inventory. The buyside have now adopted the use of new types technologies and, based on discussions with the buyside, K&KGC is revising our research methodology to reflect the changes. Some firms are still holding off while others are taking a step to implement various auto execution tools for low touch bond trading. The top three dominant bond trading venues offer, or are planning to launch, solutions based on the auto execution protocol but some forward thinking Winter 2018