Tradeweb reports record trading volume in October

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Digital trading platform Tradeweb has reported total trading volume for October 2021 was a record USD25.6 trillion across rates, credit, equities and money markets, with average daily volume (ADV) for the month at a record USD1.26 trillion, an increase of 39.4 per cent year over year (YoY).

Lee Olesky, Tradeweb CEO, says: “October 2021 was a record-breaking month for Tradeweb, with incredibly strong results in government bonds, rates derivatives and credit. The wide range of execution protocols we offer within those asset classes was centrally important to our clients, with robust usage of streams, request-for-market, portfolio trading, request-for-quote, and session-based trading. We believe the market participants we serve want to execute electronically, as well as digitise more of their trading workflows.”

In October, Tradeweb facilitated record activity in U.S. Treasuries, European Government Bonds, Rates Derivatives, and U.S. High Yield credit. Additionally, Tradeweb set new records in TRACE market share for both U.S. High Grade and U.S. High Yield, capturing 22.3 per cent and 11.0 per cent respectively, with a record 7.5 per cent of U.S. High Yield transacted fully electronically.

U.S. government bond ADV was up 77.5 per cent YoY to USD148.9 billion, and European government bond ADV was up 32.7 per cent YoY to USD36.3 billion.
Record activity in U.S. government bonds was driven by a combination of factors including record trading across institutional and wholesale markets, boosted by streaming protocols, as well as the addition of the Nasdaq Fixed Income business. Record activity in European government bond trading continued to benefit from strong activity in UK Gilts. Steady global government bond issuance, along with recent rising rates market volatility, remained supportive of trading.
∙ Mortgage ADV was down 6.5 per cent YoY to USD201.0 billion.
o Declining issuance and record home price appreciation weighed on overall market activity.
∙ Swaps/swaptions ≥ 1-year ADV was up 68.3 per cent YoY to USD202.9 billion, and total rates derivatives ADV was up 135.8 per cent YoY to USD491.3 billion.
o Swaps/swaptions ≥ 1-year volumes were driven by robust client interest in the request-for-market (RFM) protocol and continued engagement from international clients. Record emerging markets activity reflected continued momentum due to the continued adoption of electronic trading. Market focus on evolving central bank policy drove record trading in swaps/swaptions < 1-year.

∙ U.S. Credit ADV was up 25.8 per cent YoY to USD6.6 billion and European credit ADV was up 15.2 per cent YoY to USD1.8 billion.
o Continued strong growth in U.S. and European credit was driven by client adoption of the request-for-quote (RFQ) protocol, session-based trading, and the further growth of portfolio trading. U.S. High Yield ADV set a new record, as did trading across Tradeweb AllTrade. U.S. High Grade TRACE market share was 22.3 per cent, of which 12.8 per cent was transacted fully electronically, and U.S. High Yield TRACE market share was 11.0 per cent, of which 7.5 per cent was transacted fully electronically.
∙ Credit derivatives ADV was down 3.7 per cent YoY to USD11.4bn.
o Waning credit market volatility weighed on volumes.

∙ U.S. ETF ADV was up 5.4 per cent YoY to USD4.9 billion and European ETF ADV was up 25.1 per cent YoY to USD2.2 billion.
o Continued growth of institutional clients contributed to higher volumes in U.S. and European markets. In the U.S., the strong growth in institutional trading more than offset declining wholesale activity as a result of waning equity market volatility.

∙ Repurchase Agreement ADV was up 1.9 per cent YoY to USD328.5 billion.
o The addition of new clients on the platform continued to support growth in Global Repo activity. Retail money markets activity remained pressured by the low interest rate environment.

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