Looks like BNP Paribas are the latest in the single-dealer FI trading system renaissance.
http://www.finextra.com/fullstory.asp?id=17068
Not too much detail on what specific products will be offered, however they will be using Caplin Trader, which was launched last month, as the front-end.
Can only assume they’ll look to use this to augment the vanilla offering, on the likes of TradeWeb and soon LiquidityHub, with more sophisticated products and functionality (executable trade ideas, executable axes etc).
I understand Citi are working on something (may have launched?) but the last brochure I saw on it had a Fixed Income title but then described their FX system!!!! Likewise UBS and HSBC are supposed to be working away and are Banks that have tended to confound me with their previous lack of impact in FI e-Trading. Morgan Stanley are meant to be working on something quite cutting edge.
Definitely the way to go for differentiating yourself, but one can’t help but feel these banks have a long way to go to catch up with the BARX and DB Autobahn offering and, most importantly, perception.
July 5, 2007 at 11:11 am
indeed – i remeber JPM’s all signing and dancing single dealer platform for Bonds/FX/Equity (Flowbiz it was called), it was a lavish system from a functionality and technology point but it was basically a flop – firstly because nobody really bothered to ask the client what they “really” wanted and secondly because multi-dealer platforms where all the rage at the time..
July 6, 2007 at 1:48 pm
As it happens, Flowbiz (marketed as JPMorgan Express) was based on our software, as well as BNPP and in fact the Citi project referred to by waratah, so we have some insight into this area.
When all the multi-dealer platforms first appeared a few years ago, the conventional wisdom was (as monkeydust says) that they would be the dominant route to market for the dealers.
In FX this has turned out definitely not to be the case, and every major FX dealer now has a single-dealer trading portal, as well as participating in the multi-dealer portals. A lot of flow goes through each of these channels, but they address very different market segments.
Much the same thing now seems to be happenning in the FI space, with the sell-side firms starting to build a new (and much more focussed) generation of online trading systems. It is not yet clear how successful these will be, but there is a growing sense that their time has come.
And of course the latest excitement is about combining these to product cross-product or (for the more ambitious) multi-product offerings. A nice idea if you can get it to work…
July 10, 2007 at 12:53 pm
Paul, your software seems to be getting some nice acceptance in the dealer community. I can think of a few ECN’s that could yuse your help!
July 12, 2007 at 2:16 am
there is a present belief that if the top ten dealers in fixed income all offered competing platforms, only the idb’s and exchanges would do better.
this is one reason why they keep trying to
join together and build things
the problem they have is once the venture does well, they sell them, ie. TradeWeb, BrokerTec
Next time they need to hold on. sadly it seems
they are turning to reuters, to get away from TradeWeb, and TradeWeb buys reuters….
seems silly?
July 17, 2007 at 9:08 am
Thanks, waratah. As for the ECNs — MarketAxess started using our technology a while ago, but the others seem pretty unconcerned about the quality of the front end, apparently seeing their competitive edge purely in terms of dealer access. I suspect that this will change.
Not quite sure what oldtimer is trying to say in his first paragraph, but possibly he is missing a key point here: the idbs and single-dealer portals don’t compete so much as complement each other. They serve different parts of the market, and both are needed. It’s like Expedia versus the airlines’ own sites — they are both useful in different ways if you’re planning a trip.
The big wild card now is LiquidityHub, of course, which could really change the game in FI.
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