[ M E E T T H E D E S K | N I N E T Y O N E ]
all of the prints going through the market . I ' m hoping that the consolidated tape helps with that to some degree .
“ It [ finding liquidity ] varies from situation to situation . Often we won ' t commit orders fully to a broker . We ' ll always keep some on the side just in case any liquidity emerges and we have to be quick move on that liquidity if it appears . We may be working an order with a broker and then we see that we ' re not really capturing the volume that ' s going through the market and we see it going elsewhere , so we have to be prepared to move our order if needs be .”
With the addition of Sam Spencer who took over trading US equities , Kumarasinghe now only covers Europe . Unsurprisingly , fragmentation - something that has become a poster child for rhetoric surrounding the region - is often front of his mind . Europe , with its 27 member states each with their own venues and players , is naturally more fragmented than the US or Asia . And , as Kumarasinghe notes , new entrants looking to launch platforms and venues in the region must be mindful of their role in exacerbating this .
“ It ’ s a bit disheartening when a new entrant appears without providing any differentiating USP ,” he says . “ We need to have access to those liquidity sources so once they ' re established , we ' re going to use them in an all likelihood , but it just makes our job a little bit harder and sometimes fragments liquidity further .
“ There are always new entrants looking to come into the market , new intermediaries trying to insert themselves into the workflow . Sometimes that doesn ' t necessarily leave us with a better endpoint .
It can result in more fragmentation in the market as well as additional layers of fees . There ' s a point where you definitely get diminishing returns .”
Technology wish lists That being said there remain some areas where the traders at Ninety One are hoping to see some innovation . For Wood , the most important future development is seeing frequently used tools such as e-trading or list trading extend into into more niche areas of the market such as loans , CLOs or swaps where flow is still transacted bilaterally .
“ There ’ s a noticeable gap between widely traded products and niche markets that haven ’ t been as effectively addressed ,” he says .
“ Technology platforms and banks need to see profitability to continue supporting and advancing those markets . Many banks will prioritise decisions that drive market growth if they see a financial benefit .
“ We were frequently forced to suspend relationships as they teetered on the brink of collapse . It was a chaotic period - banks were reporting record trading days , but for all the wrong reasons .”
DAMION KUMARASINGHE
We ’ ve seen this with new issuance automation and electronification , which still haven ’ t reached the desired level of efficiency .”
The traders at Ninety One , both in London and in their offices around the world , have a cohesive and collaborative approach to executing in the markets . The markets have by no means been easy for the last few years but as Gibson says , when have they ever ?
“ Traders by nature enjoy a challenge . That ' s their reason to be . Getting best client outcomes , chasing the best price , finding the best liquidity , the real value add is in those difficult situations and that ' s where people get a sense of real and honest job satisfaction ,” Gibson concludes .
Given the fact that several of the Ninety One traders have stuck around through multiple financial crises and still come back for more , it appears that may be true .
50 // TheTRADE // Q3 2024