Tradeweb Reports Monthly Activity
Tradeweb has published its May 2019 Monthly Activity Report, which captures trading activity in fixed income, derivatives, and ETF markets.
Across all asset classes, May 2019 set a new record in total trading volume, with average daily trading volume (ADV) of 741.8 billion, up 38.7% year over year. The strong volumes were driven by a rise in trading of short-term tenors as well as continued growth in overall trading volumes
Key trends for the month include:
- Short-Term Rates Trading Surges: Activity in rates derivatives increased 94.0% year-over-year in May, reaching a total ADV of $228.1 billion, predominately driven by an increase in trading of swaps and swaptions under 1 year in duration.
- Repo Volumes Crest $200 Billion for First Time in Decade: Total ADV of $211.5 billion in repurchase agreements were traded during the month of May, an increase of 43.7% year-over-year, and the first time repo market volumes exceeded the $200 billion threshold since March 2009.
- Increase in Mortgage-Backed Security Volume: Total ADV of $157.7 billion in mortgage-backed securities was up 14.6% year-over-year, driven in part by the inception of trading of Uniform Mortgage-Backed Securities, the new common mortgage-backed security issued by both Fannie Mae and Freddie Mac.
- U.S. Government Bond Volumes Rise Amid Volatility: U.S. government bond trading volume was up 23.6% in May, bringing total ADV for the month to $83.6 billion, reflecting the repricing of market expectations as yields continued to decline throughout the month.
- Chinese Bond Market Activity Continues to Grow: ADV of $859 million in Chinese bonds were traded on the Tradeweb platform in May, an 85.7% year-over-year increase.
The full Tradeweb Monthly Activity Report for May 2019 is available here: https://www.tradeweb.com/market_activity_reports/
Electronification of the municipal bond market also presents a large opportunity.
The success of Northbound trading showed electronic execution is way forward for the bond market.
IRS trading volumes have fragmented without an equivalence agreement.
Increased electronification has created useable and accessible real-time and historic trade data.
Members are evaluating payment-versus-payment for currencies not yet eligible for CLSSettlement.