June 20, 2023 | Stamford, CT — The growing complexity of fixed-income market structure is accelerating the adoption of execution management systems (EMSs) that help traders navigate a market that is only partially electronic, fragmented and flooded with inconsistent data. 

Over the past decade, the electrification of fixed-income markets has given rise to a host of new trading venues and protocols, vast pools of new data, and novel tools driven by artificial intelligence (AI) and machine learning (ML) and other technology that help investors aggregate liquidity. As the marketplace becomes more diverse and fractured, traders using existing order management systems (OMSs) and traditional trading methods are able to “see” a smaller and smaller fragment of the overall market. 

“In this new environment, buy-side professionals are finding that the technology and approaches they have been using for years to find liquidity and execute trades are no longer up to the task,” says Audrey Blater, Senior Analyst for Coalition Greenwich Market Structure & Technology and author of Fixed-Income EMSs: The Time is Now.

Buy-side organizations are starting to adopt EMS systems capable of providing access to liquidity from multiple sources in a single blotter, automating trading workflows and facilitating advanced analytics. EMSs afford them improved speed, access to information, compliance, scale, and ultimately, cost savings via better execution quality.

While cutting-edge EMSs have been available to the market for some time, only a relatively small share of study participants are using systems that can accurately be labeled as EMS, and only the earliest and most progressive adopters are realizing significant improvements at this point. That situation is set to change quickly despite nascent adoption rates. 

“Given the rapidly changing dynamics of the marketplace, the astronomical pace of technology innovation, and the clear advantages of these new systems over the traditional model, it’s clear that the market is nearing the tipping point for EMS adoption,” says Audrey Blater.

Fixed-Income EMSs: The Time is Now presents the full results of interviews with 41 trading professionals in the U.S. between March and May 2023 that examined the changing role of EMSs for institutional fixed-income trading. The report examines the current state of the corporate bond traders’ desktop technology, how the buy-side trades corporate bonds today, demand for EMSs in the fixed-income market, and the tools buy-side traders hope to have access to tomorrow.