The TRADE 60 | Page 71

[ M A R K E T R E V I E W | F I X E D I N C O M E ] “Data aggregation is probably our number one priority right now.” JIM SWITZER, ALLIANCEBERNSTEIN to trade’ via FIX IOI (indications of interest) direct out of Aladdin with some counterparties now, which is a meaningful step towards access- ing firm-executable liquidity. a price taker. If someone’s looking for a bid on a bond, how should the buy-side trader respond? That’s not in the traditional buy-side skill set, but it increasingly needs to be. With so many protocols available across fixed income markets, the buy-side approach needs to change. As the skill set on the trading desk evolves, traders will become more comfortable with the newer protocols and have better access to a wide range of liquidity sources beyond the RFQ model. DV: In the repo markets, the rise of electronic RFQ as a trading protocol has been very impactful, paving the way for orders and electronic trading, which we utilise now. In credit trading, the emergence of automated market-making credit algos has increased dealing efficiency dramatically. This has allowed for buy-side auto-ex, which is how we execute the majority of our fixed income trading tickets (but not the majority of risk transacted). As an emergent and cost-effective liquidity vehicle, fixed income exchange-traded funds (ETFs) have been a game-changer, supporting the evo- lution of portfolio trading in credit. We’re using ‘click MO: I’m open to new and innova- tive ways of approaching a prob- lem, but we don’t need vendors to reinvent the wheel with new technology. I’m always interested in removing sources of friction from the trading process as those represent transaction costs that I’m trying to minimise. Technology and data are very useful tools to improve the effi- ciency of fixed income desks. Over- all, technology is going to solve a lot of problems for fixed income desks. We’re just at the start of the journey with artificial intelligence but I think it is likely to add value in future. JS: One of the most important things we need is a utility to con- nect fixed income market partici- pants and trading platforms. I don’t think any asset manager wants to Issue 60 // TheTradeNews.com // 71