Adam Gould (pictured), head of equities at Tradeweb, reports that it’s been another busy year for the digital trading platform.
“For the first eight months of 2021 we did close to USD200 billion notional trades against USD130 billion for the same period last year,” he says. “And 2020 was a really busy year.”
Gould notes that the Tradeweb institutional ETF platform has continued to grow as a wider range of buyside clients adopt the usage of ETFs. “It really is a diverse group of customers and money managers who use ETFs,” he says. “These include the traditional long only money managers such as pensions and insurance firms, but also continued growth from the RIA community, some of whom are trading on their own, some through their custodian. It all increases usage as they all seek good pricing on their ETF trades.”
Other clients come from private banks that have built models which consist of a number of ETFs. “And depending on market moves, they will rebalance those models through our platform,” Gould says.
The growth of fixed income ETFs, particularly this year, as a core holding or investment tool by a large group of fixed income money managers who have been Tradeweb clients for a long time has also added to the boost in business.
“It’s a combination of the increased adoption of ETFs as a viable investment tool for a wide range of customers, and also specific to the Tradeweb offering. We offer tools that organize a more streamlined workflow, which is something that all desks are trying to achieve.”
As an example, Gould says that the seamlessness of the electronic workflow means that a series of quotes come in simultaneously, as opposed to one or two or three phone calls or chats. The system is also integrated in all the order management systems (OMS) that the clients use.
“At Tradeweb, we tend to operate in a little bit more of a hybrid capacity than fully electronic, which means that we are in touch with our clients all the time.
“Relationships with [our] clients run parallel to electronic trading, and that differentiates Tradeweb from other firms out there as the clients want to be able to talk to someone if they have an issue.”
The growth and increased usage of fixed income has been a new trend that is definitely here to stay, Gould says, and a second trend is growth of actively managed ETFs and also the migration of large mutual funds into ETFs.
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