A look at current market challenges and the leading-edge tools that can mean the difference between success and failure. By Alexandre Hardouin, Refinitiv
Trusted data is the lifeblood of the fixed income trading desk, but as Refinitiv’s Alexandre Hardouin explains, data alone is not enough – traders also need the right tools to make sense of vast quantities of incoming information if they are to make sound decisions with accuracy, speed and precision.
The fixed income data explosion: opportunities and challenges
The fixed income arena in recent years has been characterised by a literal explosion in the availability of market data. Whilst more data offers fixed income traders unrivalled opportunities to better their strategies and performance, vast quantities of incoming data also create new challenges.
Driven by new technology and the rise of electronic trading, the swelling tide of available information and the move towards live prices replacing indicative bids have resulted in greater price transparency, but on the flip side, traders cannot afford to miss any important nugget of information.
They are therefore tasked with constantly revising their overall view of available opportunities, often at speed. It is here that too much information can become a double- edged sword, because pinpointing and accessing the most relevant data sets can quickly become complex and time-consuming.
A new Refinitiv whitepaper, Defining Fixed Income Data – The Value of Centralizing and
Normalizing, available at refinitiv.com/defining-fi-data, takes a deep dive into this burgeoning availability of fixed income data and offers critical insights into the attendant challenges and opportunities.
The paper specifically highlights the challenge of numerous data types, but more than this, the fact that data sources are often fragmented, meaning that market participants may need to engage several data providers, multiple trading platforms, and different regulatory bodies in order to form a complete market view.
Another core challenge centres on data quality. It goes without saying that traders should trust the data on which they base their most crucial decisions, but not all datasets are equally reliable.
Moreover, in the interests of boosting speed and efficiency, fixed income players need to find cost- effective ways to automate the flow of information.
Comprehensive solutions: a one stop shop
Given this set of on-the-ground challenges, Refinitiv has developed and refined a set of tools and solutions that can offer significant help to traders as they strive to access quality data, make sense of this data, improve their efficiency and ultimately make better decisions.
We offer a comprehensive range of fixed income data, and through our various partnerships with other fixed income players, we have expanded the scope of our offering beyond our own content and data to include some of the best-in-class solutions available on the market.
A snapshot of our solution universe follows:
• Eikon, built on open platform technology, delivers trusted news, data and analytics,
filtered to the end-user’s exact requirements. The platform connects users to markets
and professional networks and offers traders the ability to view prices from different multilateral trading facilities (MTFs), including Tradeweb and MarketAxess, as well as MiFID II reported data. This exclusive data set is unique in the fixed income market. Eikon can be accessed via desktop, over the web, or on mobile devices.
• Our Elektron Data Platform
is an integrated content and capabilities solution that enables users to access data and analytics and integrate their own data – all on a single platform. Elektron delivers real-time, reference, end-of-day, time series, and alternative data, along with powerful analytics solutions. Data is cleaned, tagged, and standardised to enable end-users to spot
the linkages, relationships, and connections that enable a holistic view of available opportunities. Data is distributed via feeds, direct to your desktop or applications from the cloud, or via hosted or managed data management services.
• IFR Markets delivers across-the-board fixed income, global credit markets and currencies coverage, including major government bond markets, investment-grade credit, high-yield, emerging markets, mortgage and asset-backed securities, interest-rate swaps and major FX pairs. IFR Markets content is available on Eikon and features integrated news flow and our New Issues Monitor, which delivers new issue information from pre-marketing to price guidance to final pricing and commentary.
• In addition, our 2018 partnership with valantic saw a new strategic combination of
Eikon and valantic’s iQbonds, which delivers market making and pricing capabilities for fixed-income products with connections to electronic markets, exchanges, and information platforms. This new integrated solution enables full coverage of the fixed income sell-side trader workflow to boost efficiency. Fixed income traders can now answer incoming RFQs at speed and simultaneously ensure that bank and market prices align.
Support for fixed income traders
Refinitiv conducts regular research into the trends and challenges inherent within the fixed income market and we tailor-make our solutions to address these challenges.
We have the breadth and depth of fixed income content and data necessary to offer real and tangible support to fixed income traders and consistently deliver accurate, trusted data. As the exclusive vendors of many of our best-in- class partner fixed income data sets, we are able to meet the full range of fixed income data and pricing needs.
With leading fixed income market data and services from Refinitiv you can get:
• Tradeweb bond and swap data covering 24,000+ unique bonds;
• MarketAxess corporate bond data covering 35,000 instruments and 90% of liquid corporates;
• MiFID II post-trade data including Tradeweb APA and MTF, MarketAxess MTF, and MTS BondVision;
• Interdealer broker rates and money market data such as IRS (including 19901 ICAP swap data), currency basis swaps, OIS, FRA, and single currency basis swaps;
• Exclusive loan data from Loan Pricing Corporation;
• Exclusive bond holding data from eMaxx;
• Access to CDS instruments through Markit and Refinitiv for single names, indices and sectors;
• Powerful real time analytics such as zero curves, swaption skews, OIS curves, credit curves, issuers curves, and RPS bond data;
• Access to Starmine credit risk model;
• Easy to use Eikon pre- and post- trade apps help you leverage market insights – apps includeAll Quotes, Rates Views, New Issue Monitor, Bond Calculator, Swap Pricer, and Multi-Asset Risk & Valuation.
This vast array of data can also be fed into your own third-party desktop applications to streamline the flow of data through your workflow, allowing you to power all your third-party desktop apps with Refinitiv data, and ensuring the same data is captured across all your applications.
A final word
As the availability of data in the fixed income space continues
to grow, market players should continually evaluate the universe of new tools and solutions that are available to support and simplify decision-making.
More information can deliver many benefits, including enhanced transparency, but not without attendant challenges. Innovative thinking and new solutions, however, can cut through complexity.
To this end, Refinitiv remains committed to the open sharing of quality data and to supporting the ongoing transformation of the fixed income market to the benefit of all stakeholders.
About the author
Alexandre Hardouin manages the Refinitiv product proposition for fixed income markets globally, driving the strategy to serve both sell-side and buy-side market participants. Alexandre worked as a Sales Trader and in a financial software start-up prior to joining Refinitiv (then Thomson Reuters). He then pursued a 15-year career in client facing and product management roles with specific expertise in fixed income markets.
The Financial and Risk Business of Thomson Reuters is now Refinitiv