Bloomberg has expanded its spread-to-benchmark quoting and trading for credit portfolio trades, supporting euro- and sterling-denominated trades.
Spread-to-benchmark quoting allows market participants to evaluate and execute portfolio trades, facilitating comparisons between credit spread risk and underlying government bonds.
This is an established practice in US dollar credit portfolio trading, Bloomberg says, and is growing in popularity across Europe as spread-based execution workflows become more common in the region.
Kevin McPartland, head of market structure and technology research at Crisl Coalition Greenwich, explained: “Portfolio trading workflows in fixed income continue to become more sophisticated as institutional investors look for ways to evaluate execution quality in changing market conditions.
“Spread-based quoting helps market participants more clearly distinguish between the impacts of credit spread and underlying rates movements when determining how best to execute a portfolio trade.”
The service is available through Bloomberg’s portfolio trading basket builder (PTBB), which was launched in 2021.
READ MORE: Bloomberg launches Portfolio Trading Basket Builder to boost workflow efficiency
Bloomberg’s portfolio trading services already support market-standard quitting conventions, referencing the firm’s evaluated pricing service (BVAL).
Harry Street, global head of credit and equities trading product at Bloomberg, said, European credit clients continue to look for execution workflows that reflect how they evaluate risk and monitor portfolio trading outcomes. Bloomberg is broadening the range of workflow options available to clients trading European credit portfolios.”
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