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Mending Market Making: How to Reverse the Corporate Bond Dealer Slump – ViableMkts 

Author: \ January 26, 2018 \ 4 Comments
Full Article: ViableMkts

There have been numerous false assumptions about what methods would help dealers achieve success in the new market. Institutions that plan to revive their bond market-making business lines must identify which fundamental changes have rendered some traditional business practices obsolete.

Comments
  • Slider
    SliderJanuary 29, 2018"The article was interesting and thought provoking but my comments have clearly hit a nerve! Personally, I am confused when the author states; "Let me make this as plain as possible.... The more information dealers have ...on... prices, the less apt they are to bid through the offer side or... print customers at mid-market". Dealers are being aggressive when printing clients here, not making mistakes, so how does having others "true prices" make it less apt to happen?…"
  • ChrisWhiteJanuary 28, 2018"Ahhh. Finally some controversy on the FNL comment board. Since I am the author, it would be my pleasure to enlighten Slider…and correct him/her. I do not imply that equal access would give dealers confidence to make a similar price. Getting access to the prices being made will give dealers the ability to make INFORMED DECISIONS when trading. I don’t understand why this is so hard to comprehend and chalk the pushback to cultural blindness. Let me make this as plain as…"
  • Slider
    SliderJanuary 27, 2018"A nice rundown of thoughts and observations but must disagree with the authors suggestion #3. Dealers gather information from a variety of sources with buy side clients being the most important. Taking this proprietary information used to make prices/markets and give it away to other dealers for the purpose of "equalizing access to pre-trade institutional pricing information" across dealers is nonsense. The author implies that if dealers had access to other dealers pr…"
  • Wolfman
    WolfmanJanuary 26, 2018"Here's another change in our markets. Not that long ago, you'd have to pay thousands to get such isightful research on our marjets. Well done Chris! Whilst you make some great points, I think it's important to note that there are solutons gaining traction in our markets to help dealers adapt to the changing times. There are times when Dealers should, and do, put captial at risk to service their clietns and other times when they don't need to. For example, Dealers want…"
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4 Comments on "Mending Market Making: How to Reverse the Corporate Bond Dealer Slump – ViableMkts "

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Wolfman
Member
Wolfman
Here’s another change in our markets. Not that long ago, you’d have to pay thousands to get such isightful research on our marjets. Well done Chris! Whilst you make some great points, I think it’s important to note that there are solutons gaining traction in our markets to help dealers adapt to the changing times. There are times when Dealers should, and do, put captial at risk to service their clietns and other times when they don’t need to. For example, Dealers want to to be recognized for helping their customers on difficult trades or at difficult times in the… Read more »
Vote Up0Vote Down  Reply
3 years ago
Slider
Member
Slider
A nice rundown of thoughts and observations but must disagree with the authors suggestion #3. Dealers gather information from a variety of sources with buy side clients being the most important. Taking this proprietary information used to make prices/markets and give it away to other dealers for the purpose of “equalizing access to pre-trade institutional pricing information” across dealers is nonsense. The author implies that if dealers had access to other dealers prices it would give them greater confidence to make a similar price. Good luck to any market maker basing their prices off of others priced. If you don’t… Read more »
Vote Up-1Vote Down  Reply
3 years ago
ChrisWhite
Author
ChrisWhite
Ahhh. Finally some controversy on the FNL comment board. Since I am the author, it would be my pleasure to enlighten Slider…and correct him/her. I do not imply that equal access would give dealers confidence to make a similar price. Getting access to the prices being made will give dealers the ability to make INFORMED DECISIONS when trading. I don’t understand why this is so hard to comprehend and chalk the pushback to cultural blindness. Let me make this as plain as possible. When a market maker has less balance sheet, and less time to park positions, trading mistakes have… Read more »
Vote Up0Vote Down  Reply
3 years ago
Slider
Member
Slider
The article was interesting and thought provoking but my comments have clearly hit a nerve! Personally, I am confused when the author states; “Let me make this as plain as possible…. The more information dealers have …on… prices, the less apt they are to bid through the offer side or… print customers at mid-market”. Dealers are being aggressive when printing clients here, not making mistakes, so how does having others “true prices” make it less apt to happen? Plus, what is a “true price”? The market shown to client A may be different (tighter or wider b/o or same tightness… Read more »
Vote Up0Vote Down  Reply
3 years ago
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