Innovation in Focus: The Analytics Powering Fixed Income Matching

by Joséphine de Chazournes,  David Easthope, November 20, 2013
Vendor Reviews

Abstract

Institutional capital markets players in fixed income have historically relied on qualitative decisions by salespersons as well as brute force tactics to match trades. However, with balance sheets disappearing, both the dealers and the buy side are leveraging analytics for their fixed income matching purposes.

In Innovation in Focus: The Analytics Powering Fixed Income Matching, Celent examines the increasing use of analytics surrounding the fixed income matching and execution process. The report also highlights emerging technology empowering dealers, multidealer platforms, and the buy side in the fixed income markets. Celent believes the data analytics evolution is targeting fixed income products which have liquidity constraints or are otherwise presented with matching difficulties.

Ultimately, analytics in fixed income will be built primarily on data that already exists or new data that can be easily accessed.  Much of it is underleveraged. The usefulness of these data sets will be evidenced by increasing the opportunities for matching and improving liquidity in the markets.

“The use of analytics for fixed income matching, by leveraging new and existing data sets, provides a greater likelihood of a match and therefore an execution,” says Joséphine De Chazournes, Senior Analyst with Celent’s Securities & Investments Group and coauthor of the report.

“Data analytics are being supported by innovative technology that comes in a variety of flavors and functions,” adds David Easthope, Research Director with Celent’s Securities & Investments Group and coauthor of the report.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

Executive Summary

1

Introduction

2

The Data Analytics Evolution in Fixed Income

3

 

Definitions

3

 

Evolution

3

 

Leveraging Data Analytics

3

The Vendor Landscape

5

 

Overview

5

 

Vendor Segmentation

5

Vendor Profiles

7

 

Algomi

7

 

Bondcube

7

 

B2SCAN

8

 

CodeStreet (Teamwork)

8

 

DealVector

9

 

Delph-X

9

 

MarketAxess (SalesAlert)

10

 

Summary

10

Conclusion

12

Leveraging Celent’s Expertise

13

 

Support for Financial Institutions

13

 

Support for Vendors

13

Related Celent Research

14

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