Goldman Sachs leads the flow equity derivatives market in North America and J.P. Morgan holds the No. 1 spot in Europe, according to the latest data from market consultancy Greenwich Associates.
Research published by Greenwich Associates stated that, “contrary to popular opinion”, non-bank liquidity providers were not taking meaningful share from the bulge-bracket banks.
When evaluating causation of dwindling volume in European fixed-income electronic trading, the Greenwich Report mused out loud about the potential for the market to have reached its “natural limit.”
Kevin McPartland said in the report that the buyside has accepted that electronic trading will be a key to navigating the 21st-century corporate bond market, and the sellside is coming around.
“Despite any pause in e-trading growth overall, market participants of all types are investing heavily in algorithmic pricing, which will eventually become a powerful force in fixed-income,” says Tom Jacques.
“There are probably going to be people who find themselves training machine learning technologies that may take their job away,” says Richard Johnson, who has studied the impact of AI on Wall Street.
Findings from a Greenwich Associates survey this year paint a similar picture, with a third of hedge funds using alternative data to identify new strategy ideas.
Jay Bennett added: "Brokers in this market would love some volatility — whether it came from a spike in investor conviction or fear."
“If providing buyers and sellers of corporate bonds with tools that allow them to trade with each other marks the first phase of the market’s evolution, gathering, analyzing and putting to work data is phase two,” said Kevin McPartland.
“Brokers in this market would love some volatility—whether it came from a spike in investor conviction or fear,” Jay Bennett observed.
