First some admin notes. We’ve recently created an official Greenwich Associates market structure blog. The goal was to create a seamless method for us to get new research and commentary out to the market. The market structure commentary I’ve been posting here at Kevin on the Street will mostly all end up on the new […]
FX Markets are Ready for a Shake-up
The biggest finding in our latest report on FX electronic trading was nothing. Our 1500+ interviews with global FX users showed continued growth in electronic trading (74% of users trade FX on the screen), growth in execution algorithm usage (expecting 65% growth in 2014) and high hedge fund use of the two. But those data […]
Setting FX Benchmarks with Observable Data – My Interview with CCTV America
For a market that is so electronic, using observable data to set benchmark rates shouldn’t be much of a stretch. About two weeks ago I did a taped interview for Central China TV (CCTV) America to discuss this an the electronification of FX more generally. The interview includes my attempt at explaining electronic trading in […]
What is Market Structure, And Why You Should Care
If you work in institutional finance you’ve heard talk of market structure. Not only are there entire conferences dedicated to the topic, but most of the participants at those conferences— banks, asset managers, researchers—send their heads of market structure to speak. Commonly used in economics to describe the interconnectedness of and interaction between the buyers […]
Making Proprietary Trading Public: My Interview with Bloomberg TV
First KCG and now Virtu. In 2008 no one would have guessed that in 2014 automated trading firms would be publicly traded companies – but here we are. Investors have a new way of getting in on the profits behind liquidity provision, and the market as a whole has new insight into how these firms […]
The US Invasion of European Fixed Income
Capital is expensive and getting more expensive. But the problem is proving a much harder one to manage in Europe, with European banks continuing to deleverage and already complying with the principles of Basel III while US banks have their capital houses (relatively) in order. The impact of this dichotomy is broad, but one impact […]
SEF volumes died last week – so when and where will they return?
Turned out the first week of mandatory SEF trading was a Big Bang, just in the wrong direction. Reported SEF volumes for interest rate swaps fell off a cliff for the week of February 17th, dropping 64% (revised down slightly as new data became available) from the 2014 weekly average SEF traded volume (thanks as […]
Electronic trading of bonds is growing – sort of…
We all know that the massive reduction in dealer inventories and the cost of capital has had a huge negative impact on liquidity in the corporate bond market. While the primary market has helped soften the blow, that crutch isn’t going to be here for long as rates start to rise over the next few […]
SEF Day 1: A Big Deal but Not a Big Bang
Tuesday February 18th is certainly a big deal. Requiring swaps to trade on registered platforms was one of the primary tenets of derivatives reform since shortly after the Lehman bankruptcy, and finally the day has arrived. This is the first regulatory driven change since 2008 that will deeply impact the way sell side and buy […]
Fixed Income Desks Spending More on Technology. Surprised? Me neither.
We spoke to just under 500 portfolio managers and traders globally to see what they’re doing with and what they think about OMSs, EMSs and TCA platforms for Equities, FX and Fixed Income. This is not a space of dramatic year on year change given the maturity of the providers and their products. However the […]