Bloomberg has expanded the anonymous liquidity discovery capabilities of its all-to-all platform, Bloomberg Bridge, in a bid to help buy-side users reduce information leakage, The TRADE can reveal.
The extension, named Bridge AXE, allows participants to anonymously post to other users of Bloomberg’s all-to-all platform, Bloomberg Bridge, to identify trading interests.
Due to be rolled out in Q4, Bridge AXE will allow buy-side users to discreetly identify trading interests before going on to send an RFQ elsewhere within Bloomberg’s platform universe. Once live, it will support all of the bonds that you can trade electronically on Bridge RFQ across developed and emerging market corporates and sovereigns.
“This complements our existing Bridge intermediation workflow, which will now allow interests to be anonymously published as axes on Bloomberg pre-trade discovery tools,” Katharine Furber, head of emerging markets trading at Bloomberg, told The TRADE.
“With Bridge AXE, we’re also giving clients the ability to launch a targeted RFQ, so you’ll be able to reach out to those participants that were the axe posters, and still do this using the same intermediated workflow. We think that gives users an opportunity to use all-to-all in a slightly more discreet fashion by being targeted about who your RFQ recipients are.”
Interest in all-to-all platforms for trading in fixed income has grown significantly in recent years as a means for firms to reach a greater number of counterparties in challenging liquidity environments.
Bloomberg launched its all-to-all platform, Bloomberg Bridge, in Q2 of last year and claims to have 650 active client firms on its platform as of August 2023. Rival trading venues MarketAxess and Tradeweb both have prominent offerings in this space also.
However, all-to-all trading can sometimes allow for a degree of information leakage. The platforms allow firms to trade anonymously with any buy or sell-side firm within their universes and while the uploading of cares is anonymous, it gives an indication to the market of interest in a certain instrument.
Furber told The TRADE that Bridge AXE is intended to boost buy-side interest in Bloomberg Bridge by allowing them to further minimise noise and market impact by tailoring their approaches to showing cares.
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“One of our motives with this release is to further encourage and promote buy-side participation as price makers. As well as providing all Bridge participants the ability to post a Bridge AXE, we’ve also enhanced the capability for them to respond to an anonymous inquiry on their Bridge AXES, and to do that in a way that is familiar with their existing solicited trading workflow,” said Furber.
“Functionality is there for all participants, but we know that the buy-side are constantly looking for new means to minimise noise and to save on the bid-offer, and we think that these tools may be appealing to buy-side clients in particular.”