SIX Swiss Exchange is to launch an electronic corporate bond-trading platform to allow the trading of larger but less liquid issues.
Set to be launched in the first half of 2015, the trading platform was developed in partnership with technology vendor Algomi. The multilateral liquidity pool will support market participants with the block trading in corporate bonds, often disadvantaged by insufficient liquidity, small trade sizes, and time-consuming price negotiations.
"With the new electronic trading platform for corporate bonds, we are creating a regulated market that will benefit not only market professionals but also provide greater efficiency for their clients, in other words pension funds and asset managers," says Christian Katz, the division CEO of the Swiss Exchange. "Trading participants in this electronic platform will be able to transact large orders of bonds simply and efficiently via the new liquidity pool and exchange infrastructure. This not only lowers transaction costs but also improves risk management."
The new trading platform is in line with SIX Swiss Exchange's strategy and its "over-the-exchange initiative", which intends to broaden its suite of exchange services. The platform will be domiciled in Switzerland and subject to regulatory supervision by the Swiss Financial Market Supervisory Authority (FINMA).
The fixed-income space is undergoing significant changes with the rise of alternative electronic trading platforms and the recent industry led initaitives to facilitate the trading of bonds and provide for insufficient liquidity.
While at Sibos Toronto, James shares some interviews covering topics on blockchain, fintechs and cybersecurity.Subscribe to Weekly Wrap emails