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Jane Street dominates in AP and market maker awards

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Jane Street | Best Overall ETF Liquidity Provider/Market Maker | Best Market Maker/Authorised Participant – Equity ETFs | Best Market Maker/Authorised Participant – Fixed Income ETFs | Best Market Maker/Authorised Participant – Commodity ETFs | Best Market Maker/Authorised Participant – Cryptocurrencies | Best Institutional ETF Broker

Ugo Egbunike of Jane Street answers the questions on the firm’s wins in this year’s awards.

Why do you think you won this award?

If I had to attribute it to something, it would be our people and culture: our culture is highly collaborative and we pride ourselves on hiring smart people who love to solve challenging problems. The pandemic also pushed us as a firm to develop new ways to collaborate not only across desks, but across our offices. That collaborative approach across desks is reflected in how we manage risk– with a global, centralised risk book that allows efficiency and flexibility in pricing various products.

The end result of our drive to constantly innovate leads to a client experience that is met not only with competitive pricing and product expertise, but also with a holistic approach that enables our clients to make informed decisions on their execution methods. With over 20 years of experience trading ETFs, we’ve developed the capacity to facilitate ETF trades across execution methods, asset classes, and product segments. That capacity extends to providing liquidity in underlying securities, most notably with the growth of bond portfolio trading.

What is the size and scale of your business at the moment?

Our global footprint continues to grow with offices now in New York, London, Amsterdam, Hong Kong, and Singapore–allowing us to provide 24-hour liquidity across 200+ electronic exchanges, in 45+ countries around the world.

In the US, we’re a registered market maker in over 2,700 listed ETFs, and act as lead market maker for 20 per cent of US-listed ETFs. In addition to being one of the leading liquidity providers in ETFs, we’ve also become well-established in liquidity providing across equities, fixed income, commodities, options, and digital assets.

What trends have you seen over the past year?

We continue to see product innovation across the ETF landscape with over 300 new launches and net inflows of USD485 billion YTD. Part of this growth has been led by the launches of ETFs by traditional mutual fund managers, but the majority of it is still driven by the continued adoption of established, passively managed funds. While ETFs originally started as trading as retail-oriented investment vehicles, over the last few years we have continued to see significant growth and adoption of ETFs amongst institutions.

Much of this growing demand comes from institutional investors looking to understand the ETF ecosystem and ways that it could benefit their portfolios, whether it be by providing beta exposure, or by acting as a “liquidity sleeve” in their portfolios to meet liquidity demands during times of stress.

This follows on from the market volatility experienced during March of 2020, which proved to be a significant stress test for ETFs that showcased their ability to meet liquidity demands from investors while still providing exposure and price discovery, especially at a time when liquidity was starting to break down in some underlying markets.

Where do you see the ETF industry going in terms of products over the coming year?

Chances are that you’ll continue to see more innovation within the fixed income ETF space as investor demand adjusts in light of a new rate environment. This is the first time we’re seeing real rates materialise across the market in years, and though this provides a challenge to investors, it’s also an opportunity to develop new ways of managing their portfolios with respect to liquidity. As a result, you will likely see ETF product innovation continue to try to meet these new demands and expectations.

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