Fixed Income Trading Platform Launched

Terry Flanagan

DelphX, a provider of neutral alternative trading systems (ATS) for informed and transparent trading of fixed income securities, is collaborating with SunGard to create CentralX, a neutral, centrally-cleared global facility.

SunGard will provide Financial Information eXchange (FIX) connectivity through its SunGard Global Network (SGN). The CentralX market will be integrated within SGN to facilitate anonymous all-to-all interaction of orders entered by SGN users and buy-side and sell-side subscribers to DelphX and other participating fixed income ATS/ECNs and linked trading platforms.

“CentralX is specifically designed to serve the growing need for centralized interaction among all fixed income market participants to help achieve best execution, stimulate liquidity and reduce market fragmentation,” said Larry Fondren, president and CEO of DelphX. “Our commitment to providing transparency, anonymity and a level playing field to all market participants is complemented by the global scale of SGN and its connectivity with thousands of firms around the world.”

Shifting economic forces and merging regulatory pressures are transforming the fixed income market and altering the way participants interact and access and source liquidity.

“SGN and DelphX are working together to help facilitate unified market interaction and anonymous access to deep new sources of price-sensitive liquidity,” said Ralston Roberts, chief operating officer, real-time market data and network services, SunGard’s brokerage business.

“We are hearing form a lot of clients that there is a need for liquidity in the fixed income market,” said Roberts. “Liquidity has dried up as a result of the Dodd-Frank Act and the Volcker Rule.”

CentralX is a neutral meeting ground where counterparties can interact. “It allows them to access anew source of fixed income liquidity, as well as automate some of the processes associated with voice-broker trading,” Roberts said.

DelphX is a fixed-income market that provide continuous real-time fair-value pricing for more than 30,000 listed securities, including those that rarely trade. The DelphX ATS will facilitate transparent all-to-all trading of corporate bonds, ABS/MBS and other fixed income issues among issuers and buy-side and sell-side firms.

“When you enter an order, you are advised by the system what the fair market value is based on its trading history,” said Fondren. “Our mission is to come up with a vehicle that is natural, fully transparent, anonymous, and will encourage the maximum number of counterparties.”

Evidence-based valuation of listed fixed income securities be enabled by the DelphX proprietary MAV=n protocol, which continuously adjusts, validates and publishes the fair-value price of every listed security based on the historical and current transaction pricing of cohort securities determined to be ratably congruent.

SGN is a trading services network that links asset managers and brokers throughout the financial services value chain, offering trade automation and connectivity for equities, fixed income, listed derivatives, mutual funds, money market funds and other cash equivalents. DelphX provides real-time fair-value pricing and anonymous alert, query, negotiation, matching and clearing services for best execution among all market participants.

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