[ T H O U G H T L E A D E R S H I P | T R A D E W E B ]
As hedge funds and systematic traders expand their presence across global fixed income markets, advances in automation, algorithmic execution and electronic liquidity are reshaping how institutional investors engage with derivatives markets.
Tradeweb has been at the forefront of this evolution through innovations including its automation tool, AiEX; bilateral trading protocols; and integrated multi-asset execution tools.
What’ s driving growth in automated swaps trading? Flaim: Swaps markets have become increasingly electronic over the last decade, but we’ re now seeing a broader evolution in how clients interact with liquidity and execution workflows. Hedge funds, systematic firms and traditional asset managers are looking to automate lower-touch trading activity while improving efficiency.
That shift is visible in trading behaviour. In 2025, automated trades represented more than 40 % of institutional trades executed on Tradeweb, up from 30 % in 2021.
This is particularly true in swaps markets where participants are managing larger datasets, reacting to macro events in real time and operating across multiple liquidity pools. Automation helps them scale activity while maintaining control.
Are systematic firms and traditional asset managers approaching electronic swaps trading differently? McDiarmid: While systematic firms were early adopters of automation and data-driven execution, many traditional asset
The evolution of systematic rates trading
In this Q & A, ANGUS MCDIARMID, head of European Interest Rate Swaps, and DANIEL FLAIM, head of US interest rate swaps at Tradeweb, discuss the rise of systematic swaps trading, evolving client behaviour and the next phase of electronification across global derivatives markets.
managers are now implementing similar workflows.
The focus today is less about participant type and more about use case. Clients want the ability to automate smaller or repeatable trades while retaining transparency and control for more complex execution decisions.
Traders and portfolio managers also want to connect directly into tools like Excel or Python-based analytics environments. As confidence in these tools has grown, we’ re seeing clients becoming more comfortable transferring larger or more risk-sensitive trades through automated and integrated workflows while maintaining appropriate oversight.
How has volatility influenced systematic trading activity? Flaim: Periods of uncertainty tend to reinforce the importance of resilient electronic workflows and reliable access to liquidity as clients put even more emphasis on execution efficiency, pricing transparency and operational certainty.
One of the biggest shifts we’ ve seen is that electronic trading functions effectively even during periods where historically markets might have reverted toward manual or voice processes.
We saw strong activity across swaps markets earlier this year as participants responded to fast-moving conditions.
24 // TheTRADE // Q2 2026