First quarter sees Tradeweb break US$1 trillion ADV

Dan Barnes

Market operator Tradeweb saw a US$1.06 trillion record average daily volume (ADV) for the first quarter of 2021, an increase of 18% compared to prior year period with ADV records in US and European government bonds, mortgages, rates derivatives, US investment grade (IG) bonds, US high yield (HY) bonds, European credit, Chinese bonds, repurchase agreements (repo) and European exchange traded funds (ETFs).

Its trading volume for April 2021 was US$19.3 trillion across its markets with ADV for the month reaching US$896.8 billion, an increase of 17.5 percent year-on-year (YoY).

“Tradeweb continued to grow its U.S. credit market share in April, with our fully electronic share for US IG TRACE reaching 11.7% up from 3.0% just three years ago. Credit markets are seeing more trading volume executed electronically, and Tradeweb has increased its share of that growing volume thanks to innovative tools and protocols such as electronic portfolio trading, net spotting and automated trading via AiEX to name a few,” said Lee Olesky, Tradeweb CEO. “Tradeweb experienced sustained momentum throughout the first quarter of 2021 thanks in part to stronger client engagement, changing user behaviours and accelerated trends in electronic trading adoption and innovation. We averaged more than US$1 trillion per day in trading volume during each of these three months, which was especially remarkable given the quarter’s relatively subdued volatility.”

The firm has noted a marked change in client behaviour from prior to the pandemic which it reports stem from participants integrating newer execution protocols and advanced trading technologies that allow for more efficient price discovery and enhanced automation into their trading workflows.

The firm’s rates revenues of $142.9 million in the first quarter of 2021 increased 13.4% compared to prior year period as higher global issuance and increased client adoption drove higher volumes in government bonds, mortgages and swaps. Government bond trading saw growth in execution via streams and session-based trading, while swaps saw growth in request for market (RFM), list trading and emerging markets interest rate swaps (IRS).

In credit revenues of US$74.4 million in Q1 increased 37.8% compared to prior year period with US and European corporate bond trading volumes reportedly growing to record levels. Corporate bond client activity was strong notably in global portfolio trading, as well as Tradeweb AllTrade with anonymous all-to-all and session based trading being highlights.

April saw US government bond ADV up 7.4% YoY to US$95.5 bllion, and European government bond ADV up 3.8% YoY to US$28.4 billion. Steady global government bond issuance remained supportive of trading generally despite waning market volatility.

In the same month US credit ADV was up 21% YoY to US$6 billion and European credit ADV was up 30.7% YoY to US$1.9 billion.

©Markets Media Europe, 2021