Wall Street Treasury Desks Survive, Thrive in New Obscurity
- Banks' pullback from risk-taking belies robust client business
- More Treasury trading at biggest banks being done internally
The shift in trading means more of the action in the market is happening without accessible data detailing which Treasury securities are trading, and at what price.
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All the handwringing over Wall Street’s retreat from Treasuries dealing, it turns out, may be overdone.
The banks are taking less risk, of course, and are getting squeezed by the high-speed trading firms proliferating on venues where they traditionally made markets. But their withdrawal from the $12.9 trillion market is less severe than would be indicated by their balance-sheet declines, or by their volumes on central platforms like ICAP Plc’s BrokerTec and Nasdaq OMX Group Inc.’s eSpeed.