MarketAxess has added new functionality to its electronic bond trading platform, which now lets users better manage market impact and source liquidity in the credit markets more effectively.
The fixed income platform operator has introduced DealerAxess, which it claims is the first anonymous request-for-quote trading protocol for the bond market.
DealerAxess lets broker dealers electronically send bids and offers anonymously to each other, which the firm said helps members manage their balance sheets more actively. Following the introduction of Basel III, the latest set of guidelines for ensuring banks are properly capitalised, brokers will have to hold risk-weighted collateral against the assets they hold on their balance sheet, making the provision of liquidity for some instruments more expensive.
Over 5,000 trades from 600 users have been executed through DealerAxess following its introduction to the market two months ago.
MarketAxess has also improved the market lists tool on its client-to-multi-dealer system, which lets investors display orders anonymously to the company’s 1,000-strong member base. The new functionality allows buy- and sell-side firms to create customised alerts and watch-lists for specific instruments and notifies them when live orders are in the system from other investors.
In June alone, more than 9,500 US high-grade orders worth over US$6 billion were made available through MarketAxess’ market lists, according to the platform’s own data.
“Incoming regulations such as Basel III are placing greater pressure on dealer balance sheets and credit market liquidity,” said Rick McVey, chairman and CEO, MarketAxess. “In response to these significant shifts in market structure, we are expanding our suite of electronic trading options. These new liquidity solutions will provide greater flexibility for both dealer and investor clients as they adjust to the new regulatory environment.”