In liquidity-strapped credit markets, Bloomberg offers institutional clients a new model to identify trading opportunities
Bloomberg today announced the launch of the Bloomberg Bond Cross function (BBX<GO> on the Bloomberg Professional service) allowing European buy-side and sell-side participants to access European bond market liquidity with State Street.
State Street1 will act as an impartial counterparty for each trade. As a result, participants minimise information leakage and retain anonymity throughout the execution process. Every participant must be a customer of and be on-boarded by State Street.
Bloomberg Bond Cross will use Bloomberg’s Trading System Order Execution (TSOX) staging blotter, which is currently used by more than 650 Bloomberg customers in Europe. Once orders are entered into TSOX, State Street uses the Bloomberg Bond Cross technology to find the opposite side of the trade. Participants can then work towards negotiating and executing a trade with State Street. Bloomberg Bond Cross supports trading in just over 160,000 credit fixed income securities.
“Despite constraints on dealers’ ability to make-markets in corporate credit, large orders still need to be executed each day,” says George Harrington, global head of FICC trading at Bloomberg. “Bloomberg Bond Cross brings together our existing large network of Bloomberg Professional service subscribers, providing the ability for order staging, negotiation and transacting in one place, attracting volume and building liquidity to help investors identify trade opportunities with State Street.”
“The pursuit of liquidity has evolved and a new breed of networked trading solutions is challenging the status quo and offering investors new channels and solutions,“ adds Martine Bond, head of trading and clearing solutions, State Street Global Markets. “As Bloomberg launches its BBX platform, we are pleased to join them at the forefront of the trend and help offer liquidity through our global, diverse client network.”
Nearly 50 participant firms have already adopted Bloomberg Bond Cross with several trades already successfully completed with State Street. A further 370 participants are in the on-boarding process and will be using the function soon. Bloomberg plans to expand the service geographically, allowing a greater number of firms to trade illiquid credit products.