Bloomberg adds block trade allocation to Bond Connect

Bloomberg will allow pre- and post-trade allocations so that clients can trade for multiple funds in one block on Bond Connect.

Bloomberg has said it will introduce bloc trade allocation and structured product trading support for offshore investors using its electronic trading platform to access China’s cross-border fixed income platform Bond Connect.

Using Bloomberg Terminal, institutional investors will be able to trade on behalf of multiple funds in one block with the pre- and post-trade allocations. Bloomberg said the new function will streamline the workflow of large transactions and integration with existing order management systems.

Bing Li, head of Greater China at Bloomberg, said that the firm has seen a significant increase in foreign activity in Chinese bonds since the beginning of the year, with the Bond Connect initiative allowing overseas funds to buy onshore bonds through Hong Kong.

“We have been working closely with CFETS (China Foreign Exchange Trade System) and Bond Connect Company Limited to upgrade our offerings to facilitate further participation by foreign investors in this burgeoning market, and connect onshore market makers with the global investment community. This will help advance the further development of China’s financial market over the long-term,” Li added.

Bloomberg became the second approved trading platform to operate within Bond Connect after Tradeweb, providing a trading interface for offshore investors accessing the cross-border bond trading and settlement scheme that links the Mainland China and Hong Kong markets.

Tradeweb launched its own block trading functionality on Bond Connect in September, also allowing the buy-side to allocate and complete block trades to multiple client accounts. More recently, Tradeweb added live liquidity streaming and instant messaging functionality for clients trading on Bond Connect.

Foreign holdings of Chinese onshore bonds reached 1.11 trillion yuan as of May 2019, according to data from Bloomberg. At least 109.3 billion yuan of Chinese bonds were bought by foreign investors in May, the highest amount in the past year.

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