“There is little or no transparency on how allocations are derived. Regulators have been focused on best execution, but they should have also looked at the transparency of the allocation process because it is not clear, fair or efficient,” said Cathy Gibson, head of fixed income trading at Royal London Asset Management.

This article – which is the first of a series of three produced by GreySpark Partners analyst Willis Bruckermann on behalf of AxeTrading – examines how buyside fixed income market participants are, in 2018, approaching a sink-or-swim moment in their embrace of e-trading capabilities and, consequently, succeeding or failing to develop an ability to survive in an increasingly competitive landscape.

“The IPO discussion is an option. We haven’t committed to it but it certainly is an option. The governance of Tradeweb was designed seven years ago with banks who at the time [were] all very active in fixed income. It wouldn’t be breaking any top secrets to say that they’re not all as involved in fixed income as they used to be.”

Uber Technologies Inc. sold its first-ever bonds late Wednesday, issuing $2 billion of debt to fund operations as it prepares for an initial public stock offering expected next year. The deal attracted enough interest from investors for underwriter Morgan Stanley to increase the size of the offering from an initial proposal of $1.5 billion. 

The feedback I have heard from a few head fixed income traders lately is that they no longer get paid to execute with the street (i.e. manage inventory). Instead their priority is to fill customer orders. Moving, not storage. The idea that a trader might identify a “cheap” bond, take it into inventory, then try to find a home for it with a customer, but failing that, be able to sell it back to the street at “fair value” on some future date is becoming an antiquated notion.

Stephen Laipply, managing director and head of US iShares fixed income strategy at BlackRock, said that handling larger trades electronically “has yet to be solved.”

BlackRock’s Aladdin risk-management system, a software tool that can track and analyze trading, monitors a whopping $18 trillion in assets for 200 financial firms; even the Federal Reserve and European central banks use it. This tremendous financial base has made BlackRock something of a Swiss Army knife—institutional investor, money manager, private equity firm, and global government partner rolled into one.

Credit traders at some of the world’s largest banks are convinced hedge funds and brokers have penetrated their members-only club. The claim — based on interviews with more than 16 bankers, including seven who head trading desks — is that rivals and even clients are now accessing information from trading platforms that have long been the exclusive domain of the banks.

How can officials from the Federal Reserve to the Bank of Japan even pretend to know how to reverse what they’ve done over the past decade? I’m speaking specifically about propping up financial markets with easy money and allowing the world’s debt burden to balloon to almost $250 trillion.

ETFs edged out credit-default swaps — at the single-name and index level — and were second only to corporate bonds themselves as a way for professionals to access fixed income.