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Credit Information Overload – The Desk 

Full Article: The Desk

The inability to process pricing data for corporate bonds is preventing buy-side traders from finding real opportunities to trade. Data is readily available; broker-dealers, specialists data aggregators, TRACE, Bloomberg data and benchmark providers all give guidance on where a price may be. In fact there is too much of it. The quality of that information is highly variable, the volume provided by dealers is increasing, and the absence of a standard format makes it hard to compare. 

ICE to Acquire TMC Bonds – Finextra

Full Article: Finextra

Intercontinental Exchange (NYSE:ICE), a leading operator of global exchanges and clearing houses and provider of data and listings services, today announced that it has entered into an agreement to acquire TMC Bonds LLC for $685 million in cash.

  • Goose
    GooseJune 1, 2018"Quite the interesting price and purchase by ICE. They bought practically the exact same customer base for credit that they paid for in KBP, plus plenty of duplication in the muni market customer base. Certainly TMC has some solid proprietary connectivity there. They are officially in the front end business, and I will be curious to see if they stay there. Will they follow with a strong regulatory push to try to force the markets in to a more fair access/rules based ex…"

Pope Goes Off on CDS Market, Calls Derivatives Ticking Time Bomb – Bloomberg Quint 

Full Article: Bloomberg Quint

The Vatican said that in certain areas of the derivatives markets there’s an “ethical void which becomes more serious as these products are negotiated on the so-called markets with less regulation (over the counter) and are exposed more to the markets regulated by chance, if not by fraud, and thus take away vital life-lines and investments to the real economy.”

MarketAxess Allows PIMCO to Trade by Its Own Rules – Reuters

Full Article: Reuters

MarketAxess has granted Pimco a special arrangement that allows the bond giant to limit the information it shares on the electronic trading platform and take advantage of any off-market prices, three sources with knowledge of the matter told IFR.

  • Cougar
    CougarMay 11, 2018"Dealers lack confidence to provide firm pricing for depth, especially among Tier II dealers. A large part of this lack of confidence stems from asymmetry of information (over the last 10y with FI electronification the buyside has accrued ever more pricing information over that of the dealers). This particular MarketAxess example takes that situation further toward a buyside firm's advantage - further reducing dealer confidence and so the provision of depth (real liqui…"

Fixed Income 2018: Goals and Challenges for the Front Office – Fixed Income Leaders Summit 

In Q4 of 2017, SimCorp commissioned WBR to conduct a survey of 100 front-office fixed-income professionals including traders, heads of desks, and portfolio managers. The survey focused on strategic priorities for 2018 and the operational challenges faced by fixed-income managers and was conducted by appointment over the telephone.

FIMSAC Proposal to Delay Reporting of Block Trades to Increase Liquidity – SEC FI Market Structure Advisory Committee

The Subcommittee developed the concept for a pilot to study an alternative approach that would raise the dissemination caps and modify the dissemination time frames for trades above the caps. The recommended pilot design supported by a majority of the Subcommittee is outlined below

  • Charlie
    CharlieApril 13, 2018"Higher caps is great, more transparency. The larger delay on blocks is certainly debatable. But the real tragedy is that they didn't go with alternative 1.a for measurement, i.e. the randomized controlled trial approach ("Rather than apply the new dissemination cap sizes and changes to all corporate bonds, divide bonds into a control group with no change and a test group with the changes applied.") Comparing volumes year over year is just not a great counterfactual, m…"

New Fixed Income Committee Sees Pushback on Structural Approach to Resolving Credit Market Challenges – The Desk 

Full Article: The Desk

Former Commissioner Mary Jo White had said during the planning phase for the committee in 2016, that it would be established to address disruptive trading practices, amongst other areas. Appetite for immediate action is likely to be tempered by the regulatory climate, with a move to reduce not increase regulation, and a clear need to understand the complexities.