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ChrisWhite

Entire Ivy League Outpaces Harvard Endowment in Fiscal Year 2017 – The Harvard Crimson

Comments
  • Wolfman
    WolfmanNovember 3, 2017"First, kudos to the editor of the Friday Newsletter for nailing the image once again. I assume Billy Ray is on the Dartmouth site! While this article may not be typical of the newsletter, it does underscore the notion that we are in a bear market for bonds. These aren't like equities bears, but for the institutional investor or typical bond fund, they are nonetheless dangerous to yields. The Fed has said rates are going up, and for bond geeks, that means bond prices a…"

ICE to Buy Virtu’s Bondpoint for $400MM – The Trade 

Comments
  • Slider
    SliderOctober 28, 2017"While there are obviously a lot of smart people out there and it sounds like many of them were bidding for Knight Bondpoint, I don't understand how they get to that valuation. It seems people are using MKTX as the comparison but MKTX is in a unique position basically owning the NA credit space for over 10 years now watching TradeWeb and Bloomberg trip all over themselves multiple times in an effort to compete with them. To be fair, TradeWeb has done and awesome job in…"
  • Goose
    GooseOctober 27, 2017"The game continues to evolve. I thought it was pretty interesting that the announcement came right before the MKTX earnings announcement and call. It certainly created a diversion on the call, and generated some interesting question and response, you certainly wouldn’t have thought MKTX bid on them (unconfirmed press). From a structural perspective, KBP is the best credit ATS fit for an exchange. Minimal front end presence, lowest cost structure that is majority focus…"

What Renaissance Tech Has That You Don’t – Institutional Investor 

Comments
  • Wolfman
    WolfmanOctober 20, 2017"Pre-trade data can be invaluable, but it is not a substitute for finding the clearing price for the amount you need when you need it. The structure of the fixed income market isn't actually broken. We have near-zero volatility with historically low rates and capital restrictions creating this problem. While having more data always sounds like a solution, on its own it doesn't solve those issues.…"

Technology Spending Key to Fixed Income Market Share Growth – Traders 

Comments
  • Slider
    SliderOctober 14, 2017"'Technology spend' would seem to cover a lot of things. If we look at from the FNL perspective on how FI technology is developing I think we can say that while progress has been made, most firms are still in shambles. It is different to build something that does something than to build something that people will use to do that something. The capital markets issues attempting to be addressed today are broad and varied, leading to huge internal spends and a plethora of…"
  • Cougar
    CougarOctober 14, 2017"That there is still a problem in fixed income that other asset classes overcame years or decades ago despite all the other asset class experts being parachuted in, as well as the significant spend, point to persisting problems - lack of information to deal (AKA 'price') decisively with confidence. These two issues are the inhibitors to market structure change: 1) the need to concentrate liquidity (rather than pretend to offer all-day liquidity) to allow traders to und…"
  • Jester
    JesterOctober 13, 2017"This article is an early Christmas gift to internal IT teams at banks, but it left me with a few questions. This "$26 billion" in proposed annual tech spending across the top six US government bond dealers, is that for just government bond trading or all products? I can't believe it is the former because there is just no way that government bond desks can sustain an average annual tech spend of ~$4 billion. Treasury market making never made that type of money and toda…"
  • Wolfman
    WolfmanOctober 13, 2017"$26,000,000,000.00 is a very big number, but the powers that be understand that this is a necessary spend. What this does, however, is identify a market for technology providers to attack. Talking on new IT development projects is a lengthy and expensive task and I think we'll see more and more third party solutions stepping into the fray. What's needed is a unique combination of technology knowledge and market knowledge which opens the door for start-ups, consultants…"

Bloomberg is fighting back against Symphony – Business Insider

Comments
  • Iceman
    IcemanOctober 9, 2017"While I echo my learned colleagues views I would also add that if you look at Symphony's 'traction' in the financial markets it is not exactly far reaching.... how many companies are connected externally to chat with their clients? A stat I would love to see compared to BBG given the tag line and the amount of money and time invested in the system from the financial markets. On the plus side I do see the market changing and as Mustang pointed out a combination of Symp…"
  • Goose
    GooseOctober 6, 2017"Between overall cost cutting pressure and Symphony deals, the dealers have likely gotten rid of every single Bloomberg terminal that is not deemed essential. Maybe Bloomberg is betting on that fact, and sees this as a relatively cheap call to see if this offering can blunt Symphony by fill the needs of those not on it yet (am guessing there are a lot of firms of all shapes and sizes that aren’t), and connect back with users who didn’t deem the 22k bill essential. Now…"
  • Viper
    ViperOctober 5, 2017"I'm struggling to see the reason for this product’s existence. This does not help sales who only use IB to chat with clients. The IB-only Bloomberg product will only allow you to chat with internal employees. I hated having to fork over $2,000 per person for a Terminal, but there is no real option because their clients are all traders who need Terminals for other reasons. Switching to Symphony is a big effort for an organization and it has already been done by most of…"
  • Mustang
    MustangOctober 5, 2017"This is interesting on many fronts. Where to start? First, BBG is offering chat only for customers that have one BBG terminal at a $22k cost and for internal use only. This is competitively worse than Symphony, which has no restrictions and is both internal and external. I don’t see how a $10/month cost decrease offsets a competitively worse offering than Symphony. Price isn’t the issue and this doesn’t stave off Symphony at all. Instead, it gives Symphony a more valu…"

Most Bond Traders Don’t Like Their Jobs – Greenwich Associates 

Comments
  • Slider
    SliderSeptember 29, 2017"Jester, come on. Bond traders just might be in the second most overpaid job in the world, right behind bond salespeople. If they aren't happy, sure, go look for another career but the vast majority don't have a skill set easily transferable into the new world. Just look at what happens to older bond traders and salespeople that either didn't make enough or spent too much when they were in the same position, scrounging around trying to hang on any way they can at whate…"
  • Charlie
    CharlieSeptember 29, 2017"Not surprising given that traders think tactically, not strategically. Their optimization period is now to next bonus, or, at best, next promotion. If they were thinking about their careers over the next 10 years+, they would realize that we are probably at peak regulation. Someone thinking of joining compliance now is buying a top. Someone thinking of getting into trading is buying closer to the bottom. The upside certainly appears lower today, but I think the prevai…"
  • Jester
    JesterSeptember 29, 2017"Is this article really news? Bond trading on the sell-side has become an exercise in dodging bullets for some time now. If you aren’t blowing yourself up standing in front of toxic flow, you are constantly being told to reduce the size of your book. That combined with the fact that 90% of the days now feel like "Summer Fridays" due to lack of volatility, makes for a pretty bad seat. Finally, another aspect not mentioned in the article is the growing practice of paying…"

Goldman Sachs Has a Plan For Its Misfiring Bond Business – Business Insider 

Comments
  • Goose
    GooseSeptember 15, 2017"GS has always given heavy weight to the derivatives side of the FICC business. Today, many of its derivative stars hold key seats dictating the direction of the FICC businesses. I wonder if GS has the internal DNA to increase its penetration in the asset manager/corporate space Interestingly, there was an FT article a few weeks ago talking about the new GS algo in credit. Making several thousand automated odd lot markets has yet to prove a winning strategy to institut…"

Alternative Theory on Corporate Bond Liquidity – ViableMkts (Chris White)

Comments
  • Charlie
    CharlieSeptember 10, 2017"Definitely an interesting discussion and compelling set of facts. As the article states, the concept of liquidity is a difficult one to pin down precisely. But there are some clearly wrong ways to look at it, such as based solely on realized trading activity, another good point made in the report. Opportunities to trade is also a tough one, since it's a bit of a joint test of liquidity and REASONS to want to trade (which requires some volatility, or some other catalys…"
  • Wolfman
    WolfmanSeptember 8, 2017"As usual, another Viable Markets insightful article. I think the lack of liquidity in the corporate bond market is a function of low rates, pressure on capital at risk, the introduction of ETFs and transparency impacting market making opportunities. The fixed income markets are, in general, less prone to reacting severely to market news and geo-political shocks. There have been any number of news items that should have had this markets reeling, and for the most part,…"