After years of tiptoeing around systematic styles in debt markets, investors are starting to believe in the promise — ushering in a new world of advanced statistics and robot-learning. About 70% of institutional and 78% of wholesale investors reckon the strategy of dissecting securities by their factors, like value and momentum, are applicable to fixed income, according to a study by Invesco Ltd.

The fixed income market is witnessing an explosion of market data, which presents both benefits and challenges. With this plethora of available information, traders are faced with the task of forming a truly holistic view of available opportunities, and must do so with speed and accuracy.

“There is a push now for direct connectivity between myself and the banks, and I think the fallout from that will be, I don’t need to use one of the big three platforms to trade, if I can have five or six direct feeds.”

Pricing for investment-grade credit below $2 million is now completely electronic, with plans to expand, said Adam Korn, global head of securities division “strats” and technology. “If you come back in a year or two, I suspect we will have automated the $2-$5 million segment of the investment grade,” Korn said in an interview. 

AllianceBernstein Holding LP has introduced a robot to execute corporate-bond trades directly with bots at dealer counterparties. The $587 billion asset manager used the system in August to complete three trades with similar digital assistants at Citigroup Inc., Morgan Stanley and Royal Bank of Canada.

“The big theme here is a search for yield and a search for return,” said Rebecca Patterson, chief investment officer at Bessemer Trust. “As you have more and more negative yielding government bonds around the world, investors that need income are looking to the US.”

The company is considering an expansion into corporate bond trading and is expected to hire Frederic Boyer, who most recently worked for Ken Griffin’s Citadel LLC as a managing director and head of quantitative research for global credit.  

“At Elefant, we’ve replaced traders with algorithms and replaced salespeople with APIs,” said Raazi, referring to the code that allows computers to interact with servers. “Software-based pricing is here.”

“We should recognize what prices and price movements in the corporate market are telling us. For example, on a total-return basis, the upside has become more limited while the downside has not improved.”

Sales of investment-grade corporate bonds came to $54B in the U.S. through Wednesday, putting the week on track to be the busiest ever for corporate bond deals, with at least $70B  more projected for the rest of the month, Bloomberg reports.