Waters Rankings 2019: Best TCA System Provider: Tradeweb

For the second year running, it’s Tradeweb taking home the best transaction-cost analysis (TCA) system provider award.

Conducting TCA—an increasingly vital component of trade management—is no easy feat, especially when there is a lack of quality data. It becomes exponentially more difficult when the data just isn’t there. Tradeweb sees more than 40 products traded on its platform every day and on average handles $630 billion in notional value daily. This allows it to provide composite data across platforms and liquidity providers.

Brian McElligott, managing director and head of data strategy at Tradeweb, says clients want and need reliable benchmarks, which makes Tradeweb’s breadth of coverage a key differentiator.

“We then leverage our extensive market knowledge to help our clients review their costs on an asset-class basis. For example, we’ve seen an increase in usage among clients between Tradeweb TCA and their use of Automated Intelligent Execution (AiEX), Tradeweb’s rules-based execution protocol. That’s because clients are using TCA to refine those execution rules,” he says.

Another challenge that financial firms face is uploading trades for TCA benchmarking, which can be a convoluted process, he adds. Tradeweb has been working to streamline this by uploading data in a variety of ways so that trades can be benchmarked overnight.

McElligott says Tradeweb is refining its TCA offering “all the time.” For example, its Ai-Price module, which delivers advanced reference pricing for more than 15,000 bonds, gives clients in every region the same accurate and objective price estimate, which is also updated every 30 seconds. Tradeweb recently developed a US credit liquidity score that allows clients to review their costs by level of liquidity. It plans to add peer analysis to clients in Europe soon. The company is also currently looking to add mortgage-backed securities, global credit default swaps as well as net present value swaps.