FILS 2021: Next steps to automating the bond market

Dan Barnes

Data analysis, interoperability and flexibility are the top priorities for automating the bond markets, delegates at the 2021 Fixed Income Leaders Summit (FILS) in London have heard.

Significant strides have been made in helping credit markets to catch up with their more liquid counterparts, but fixed income desks need support in understanding the data this newfound automation delivers.

Mikael Björkman, head of execution fixed income trading at Credit Suisse EMEA, said: “We spend a lot of energy interpreting data and it takes a lot to bring that into shape, and you need to know how far you can trust it.”

Slawomir Rzeszotko, head of institutional sales & trading, Europe and Asia at Jane Street.

Slawomir Rzeszotko, head of institutional sales & trading, Europe and Asia at Jane Street, agreed that consuming and analysing data is ‘a huge workloads’ for asset managers.

Rzeszotko added: “Also, the workflow doesn’t exist front to back in its entirety; that is a priority for automation.”

Björkman said a second priority is for individuals on the trading desk to work together so automation complements market experience.

Credit Suisse said it has staff on trading desks with both coding capability and market experience so they could ensure best execution.

“We have coding on the desk so that we have translation between technology solution and those who understand the markets which helps a lot,” Björkman said.

This flexibility between traders extends to needing automation that works between the different legacy systems and order management systems (OMS) that exist between organisations.

Michael Chin, CEO at Broadway Technology.

Michael Chin, CEO at Broadway Technology, said: “We are working on delivering a platform approach that works across all businesses and that can integrate across workflows, and which also works with organisations’ proprietary analytics.”

The panel also considered the need for interoperability across the buyside and sell side.

Rzeszotko said Jane Street is working to ensure there is a flow of information between syndicate banks and the buyside.

He conceded that automation across interoperability is not there yet.

“That is phase two. We are building out that workflow. We have got 500 to 600 buyside users looking at that but we need some contraflow,” he said

He said ‘a lot of work is being done’ to ensure that connectivity is available for the buyside and sell side to work from one source.

Conference photos courtesy of Richard Hadley.

©Markets Media Europe, 2021