FIXED INCOME
of our DNA as traders. We do not interact
the same way with each counterparty
and knowing your counterparties and
their business model is crucial. This is
as important as knowing the market.
Building a relationship with your
counterparty is key and important for the
coming trades. For our traders it makes
a lot of sense to talk to selected traders
as well as the sales people in order to
get market colour, flow information etc.
Trading is an interactive and dynamic
process and the evaluation of your
counterparties is an important factor in
this aspect. Broker evaluation needs to
be both quantitative and qualitative and
preferable in realtime.
As we still experience evolving trends
among how the buy-side use bond
trading platforms, how do you feel the
race is progressing between dominant
legacy and challenger brands? Has
competitive pressure resulted in
overall innovation and how do you
foresee the competitive landscape
looking like in 3 years’ time?
The Fixed Income market is facing a
growing complexity and adapting to
that, our trading team needs to develop
and deliver smarter ways of trading
based upon eg. optimised technology.
Our traders now have alternative
ways of trading than the traditional
RFQ model and with more protocols
available, our approach is changing.
The need for a system that aggregates
all different Fixed Income strategies
is increasingly becoming a necessity
in this more and more complex world
with fragmented liquidity and diverse
trading strategies. To manage, I think
we need both better internal and
external tools. Data plays a huge role
in this, and our different trading desks
are heavily involved in all aspects of
the technology workflow, bringing
the trading, investment and execution
process closer together. We aim to
create an open infrastructure that
allows traders, quants and analyst to
work with data across the whole value
chain.
Winter/Spring 2020
We are constantly looking to improve
our trading processes for a more efficient
way of trading to meet and evidence
best execution. Data and automation are
key within this evolving area. We talk a
lot about data, which is crucial, but the
quality and accuracy of data and the use
of it is the big challenge. We tend to jump
on all data, but to filter out the noise, is
hard and a time consuming job.
However, I think in the near future we will
see a more efficient aggregation of price
streams, which will help automate the
low touch business further, turning it into
a no touch business. In general, I think
that automation and data /technology
will develop Fixed Income bond trading
over the coming years. Technology
must act as an enabler that shifts our
business focus from processing to
advice. Automation helps us to increase
efficiency and scalability by ensuring
that simple tasks and routines are being
automated leaving time to focus on
more complex tasks. Therefore, it is
important that we as the buy-side, stay
in the forefront, both regarding systems,
data, tools etc.
We need a real time tool covering the
whole market, but no one seems to
fulfull all our needs. Multiple primary
issuance solutions will also lead to the
need for an aggregation. I would like
to see a system, which is able to collect
all the primary market information and
details, including updates, allocations etc,
preferably with full STP, to our OMS.
I am not the data specialist or architect
within our team, so developing internal
tools is not me. I do however have a
clear view of what technologies I am
missing and what could be helpful or
even needed in my daily work. I do not
understand why vendors have not been
successful in fulfilling the buy-side’s
needs for fixed income trading platforms,
aggregation of data, EMS, pre-trade
engine, post trade analysis (TCA) etc.
The discussion has been going on for
years now and all vendors should already
know by now that they cannot just put
an equity framework into Fixed Income
trading. Why should it be that hard?
There is no single best provider that
supports the entire life cycle of a trade,
Tina at the 12 th ATF Fixed Income London
For the primary market we are not yet
there with “electronification” and it is still
an onerous process. Despite initiatives
such as IPREO, Direct Books, Liquidnet
etc, I think we are still far from a solution.
www.buysideintel.com
from pre-trade to compliance, and you
need to review the resources that you
have internally to try to find what suits
you best. At Nordea Asset Management
we have taken on the responsibility
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