05.31.2016

Tradeweb Flexes RFQ Muscles in Bid to Transform European Credit Bond Markets

 

Tradeweb – London – Tradeweb Markets, a leading global provider of fixed income, derivatives and ETF marketplaces, has developed an innovative way for clients to send and receive quotes across the European Credit Bond Markets. The new dynamic process is the latest result of Tradeweb’s on-going mission to evolve and advance the RFQ process which it pioneered 18 years ago.

The approach, called FlexRFQ, involves sending requests for quotes to up to six dealers at any time. If a dealer does not respond within a reasonable period, they can be replaced while the request is still live – removing the need to shut down or re-enter an order. In addition FlexRFQ helps clients to meet their best execution requirements by guaranteeing that the required number of dealers respond to the price request.

Historically the development of trading protocols have focused on facilitating execution of smaller sized trades, therefore FlexRFQ comes at an ideal time for the corporate bond market. The new protocol significantly reduces the risk of trading information leakage which can occur with medium to larger trades being sent to the entire market. With liquidity dispersed over thousands of different instruments in corporate bonds, FlexRFQ is an intelligent and more discreet alternative to broadcasting the order to all market participants, which can significantly move the bond markets. FlexRFQ also has the flexibility to add more dealers to the trade enquiry at any stage, which is particularly important during periods of illiquidity.

Commenting on the new innovation, Rupert Warmington, managing director and head of European credit at Tradeweb, said: “Over the past few years, the buy-side have faced numerous liquidity challenges as market makers have taken less risk on their books. FlexRFQ represents a far more flexible and smart way to trade and source liquidity. This will make a huge difference for asset managers as until now, asking for a quote has essentially been a binary process – our new approach bridges the gap between no-one being able to see your request and everyone seeing it. In this sense, FlexRFQ represents an important and necessary evolutionary step in the RFQ and was developed based on the market and its constant changing dynamics.”

FlexRFQ went live on 4th May and marks the latest stage in Tradeweb’s RFQ process and continuing push to provide better information to the buy-side.

About Tradeweb Markets

Tradeweb Markets builds and operates many of the world’s most efficient financial marketplaces, providing market participants with greater transparency and efficiency in fixed income and derivatives. Focused on applying technology to enhance efficiency throughout the trade lifecycle, Tradeweb pioneered straight-through-processing in fixed income and now supports marketplaces for more than 20 asset classes with electronic execution, processing, post-trade analysis and market data in an integrated workflow. Tradeweb Markets serves the dealer-to-customer markets through the Tradeweb institutional platform, inter-dealer trading through Dealerweb, and the US-based retail fixed income community on Tradeweb Direct. Customers rely on Tradeweb to drive the evolution of fixed income and derivatives through flexible trading architecture and more efficient, transparent markets. For more information, visit www.tradeweb.com.

 

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