Tradeweb has completed the first fully electronic request-for-market (RFM) swaption package trade on its Swap Execution Facility (TW SEF).
Since the inaugural trade was executed between Citadel and Barclays, 20 dealers have begun offering RFM swaption package pricing on TW SEF.
The trade type allows clients to request and receive a two-way market for a series of swaps and swaptions in a single electronic quote. This protects client intent and increases transparency, Tradeweb says, with sensitive trading information shared only between the two counterparties.
Previously, prices were based only on one direction.
John Niccolai, chief operating officer for global fixed income at Citadel, commented, “Electronically trading swaptions is an important first step in the evolution of electronically trading over-the-counter rates options, which will increase transparency, improve execution workflow, reduce counterparty risk and strengthen liquidity, making this an easier product to access and trade.”
Troy Dixon, managing director and co-head of global markets at Tradeweb, added, “This trade signals the expansion of Tradeweb’s electronic trading capabilities into a previously untapped area of the rates market.”
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