Fixed-Income Investors Have 99 Ways to Trade and One Big Problem
- Number of electronic corporate bond trading platforms surges
- Dwindling market liquidity may undermine their success
CHICAGO, IL - JULY 30: Trader signal offers in the CBOE Volatility Index (VIX) pit at the Chicago Board Options Exchange (CBOE) in front of the Federal Open Market Committee statement on July 30, 2013 in Chicago, Illinois. Investors are looking for guidance on the overall health of the economy and are anticipating the Fed will announce another reduction in its monthly bond purchases when it releases its policy statement this afternoon.
Photographer: Scott Olson/Getty ImagesIf investors are right that it’s getting harder to trade bonds, it’s not for lack of places for buyers and sellers to meet.
The bond market now has 99 electronic platforms to facilitate fixed-income trading from London to New York and Singapore, according to John Greenan, chief executive officer of technology consultancy Alignment Systems. New venues are being created as stricter regulatory capital rules and advances in technology upend the role of Wall Street dealers that once dominated the market.