Interesting update from Kevin McPartland at Tabb Group.
He reports that IRS & CDS number of trades and volume traded on both Bloomberg & Tradeweb have drastically improved. See the attached chart from his report.
My conclusion? The fundamental benefits of electronic trading in pre-trade, execution and post-trade will drive these markets. This growth is NOT due to the regulatory changes. I look forward to the ways the regulators will ensure efficient pre-trade price discovery by making the SEFs interact with each other!
Kevin’s article is here (login required). The Bloomberg press release is here and Tradeweb here.
Filed under: CCP, CFTC, Dodd Frank, MiFid, OTC, Regulation, SEF, SWAPS, Web trading technology |
SingleDealerPlatforms.Org 
Pretty strong to say that the proposed regulatory changes are not having an impact on ET volumes of swaps, not sure you can prove that point either. If your close to the dealers you will realise that actually they want to influence the eventual outcome (suprise, suprise!) and what better way to do that than show that actually the current methods of electronic execution, which do provide elements of pre-trade transparency are actually working.
Please don’t take my comments as derogatory w.r.t. the regulatory changes, they rules for clearing and post-trade transparency will help the overall market.
However, the fundamental problem with the data is that there is no easy way to compare the two venues for pre-trade. Bloomberg has private pages & messaging which *may* have seen large volumes in the past but I cannot discern that from the figures they have published as they start at 2010.
And I do believe that the buy-side push towards electronic discovery, trading & post-trade efficiencies are the true drivers of this liquidity.