Steve Toland, co-founder, TransFICC
Fixed income is in a technology arms race where all trading firms need to automate their trading workflows or risk being left behind. Automation enables faster price updates and better execution.
In rates, automating responses to RFQs has become increasingly important. TCA means that clients know which dealers provide consistent pricing and the first of these dealers to respond frequently gets the trade.
In US Treasuries, velocity is increasing. To manage this, many of the largest sell-side and buy-side firms are investing in software and hardware optimisation, including co-locating in global data centres.
In credit, portfolio trading will continue to get traction as many clients find this an efficient way to trade. However, all venues have slightly different workflows, which means that dealers connecting to multiple venues need to manage often complex workflows using technology solutions.
Outsourced liquidity, or trading-as-a-service, will continue to grow as regional banks access liquidity from other bank and non-bank liquidity providers, using an automated and efficient process. This has been happening in FX for around 20 years and is starting to get traction in govvies, corporates and IRS.
Swati Bhatia, global head of fixed income, financial information, SIX
Major asset managers have begun to pull back from riskier debt, and many investors will now be reassessing their portfolios to determine whether the returns they expect still justify the risks they are taking. To do that, reliable information across a range of bond terms and trading attributes is essential.
This year, market shocks involving Tricolor Holdings and First Brands Group have not only unsettled credit markets, they have also exposed deeper weaknesses than many expected. While it’s not obvious other companies will follow suit in 2026, they provide early warning signs that investors need to be prepared for risks in fixed income markets.
When companies with such different profiles both trigger surprise delinquencies, confidence naturally falters.
Fixed income markets are often difficult to interpret because many bonds trade infrequently, over the counter, with little pre and post trade transparency. Prices can be opaque and small data gaps can lead to significant mispricing, particularly during periods of market stress.
Investors have already highlighted corporate bond data as a major challenge, and these events show why.
Better pricing sources and more complete corporate actions data will be imperative for traders and risk departments to make sound trading decisions and managing risk with confidence throughout the New Year.
Dan O’Connell, vice president – interest rates and relative value, FlexTrade Systems
The last year saw the evolution of the rates trading space continue to gather pace – trading volumes have hit record highs, innovative technologies and new venue offerings have emerged and come to the fore.
Alongside this shift, we’ve seen increasing demand from clients and prospective customers for niche interest-rate workflows to be incorporated into the OEMS, so non-rates traders can execute nuanced trades more simply and efficiently without needing multiple trading systems.
As we move into 2026, we expect to continue to see an increase in requests for various interest rate workflows to be incorporated into the OEMS – from clients and prospective clients – both in volume and in the sophistication they offer.
An emerging area we see, for example, is the ability to trade relative value and basis in the same manner as agency sell-side brokers. Being able to do so requires direct connectivity to multiple liquidity sources and trading platforms, ensuring actionable liquidity is always available – with the OEMS being the perfect unified platform to achieve this goal.