Tag Archives: request-for-quote

ETF Broker Rolls Out Quote Capture Tool for Block Trades

January 19, 2018 MarketsMuse Curator Leave a comment

JERSEY CITY, N.J., Jan. 17, 2018 /PRNewswire/ — ETF broker WallachBeth Capital, a leading institutional brokerage firm, has announced the Phase I roll out of its internal proprietary Quote Capture platform. The platform further enhances WallachBeth’s commitment to providing institutional clients the highest degree of transparency throughout the ETF execution process.

WallachBeth has always leveraged the advantages of a competitive quote model to source liquidity for outsized ETF block trades, providing price improvement and increased liquidity in often hard-to-trade and/or illiquid products. In light of clients’ interest in the transparency provided by RFQ (“Request for Quote”) platforms, WallachBeth’s Quote Capture tool allows clients to quantify and validate their price discovery process and satisfy compliance obligations.

The foundation of WallachBeth’s ETF execution business is providing institutional clients high touch access to a full suite of execution strategies, coupled with agnostic advice throughout the trade lifecycle. WallachBeth continues to be increasingly relevant to the broadening number of institutions using ETF products and strategies to achieve their investment mandates. Andrew Mcormond, Managing Director, ETF Trading Solutions, at WallachBeth Capital states, “We always emphasize that best price often goes beyond a block trade. True best execution requires a comprehensive plan that includes experienced consultation, pre- and post- trade analysis and the invaluable expertise of seasoned ETF traders.”

About WallachBeth Capital LLC

WallachBeth Capital is a leading provider of institutional execution services, offering clients a full spectrum of solutions to help them navigate increasingly complex markets. The firm’s expertise includes ETF and equity trading, derivatives, and capital markets. Operating on a fully disclosed, agency-only basis, the firm is committed to facilitating all client needs with transparency and integrity. The firm’s website is located at www.wallachbeth.com.

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ETF News, People Profiles, Tech Talk

Bloomberg ETF RFQ Tool For Blocks: A Blockbuster

May 10, 2016 MarketsMuse Curator Leave a comment

Bloomberg LP’s agency broker Bloomberg Tradebook is continuing to grab market share in the ETF execution space thanks to introducing a blockbuster approach that has proven to work across a universe of hard-to-trade financial instruments: RFQ (“Request For Quote”). The “Bloomberg ETF RFQ” tool, which, according to a statement issued by Bloomberg LP, has triggered “a 3-fold increase in ETF volume compared to the same quarter in 2015” for the agency broker, is one that enables traders to source block trade liquidity from across a universe of liquidity providers who specialize in US-listed exchange-traded funds as well as ETFs listed in Europe, the latter of which are typically more difficult to secure tight markets for when using screen-based services that display actionable bids and offers.

Total notional value traded also tripled in European ETFs as the number of investors actively using the ETF RFQ service grew by more than 50 percent, according to a company press statement.

After launching over two years ago, Bloomberg has managed to extend its services to over 250 firms.

Market volatility and the demand for block liquidity in ETFs drove the value of the total ETF market last year. Research firm ETFGI reports that assets in global ETFs topped $3 trillion at the end of 2015.

“Institutions are finding new and increasingly strategic applications for ETFs, with 77 percent of them using ETFs to obtain Core Exposures,” said Andrew McCullum, a consultant for Greenwich Associates and author of Institutional Investment in ETFs: Versatility Fuels Growth.

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One of the stimuli behind the growth in this sector was the increase in ETF trading in the US throughout 2016. During Q1 2016, ETF assets climbed by 2.4% QoQ to $2.3 trillion in the US, which was fueled by retail channels, as calculated by Broadridge’s Fund Distribution Intelligence. In parallel to this trend, market volatility and the demand for block liquidity in ETFs also drove the value of the total ETF market to new highs over the same period.

In particular, its recent volumes have undergone a three-fold increase YoY in Q1 2016, relative to Q1 2015. In addition, Bloomberg Tradebook’s total notional value traded also tripled in terms of European ETFs, fueled in large part by the number of investors utilizing the ETF RFQ service grew – users of the service also swelled by over 50% YoY in Q1 2016.

kiran-pingali-bloomberg-etf-rfq — Kiran Pingali, Bloomberg Tradebook

According to Kiran Pingali, Head of ETF Product Development at Bloomberg Tradebook, in a recent statement on the business’ performance, “Bloomberg Tradebook developed its ETF RFQ service to address the unique challenges facing ETF investors in the United States and Europe, while also meeting client demand for direct access to liquidity in a greater variety of ETF products.”

“In the United States, liquidity is concentrated in the top 150 ETFs by AUM, with more than 90 percent of them trading less than a million shares per day. Europe faces its own challenges in sourcing ETF liquidity because of market fragmentation and low transparency due to deficiencies in trade reporting,” Pingali reiterated.

Europe ETF RFQ Demo from Bloomberg Tradebook:

ETF News, Fixed Income, Tech Talk

TradeWeb Muscles Into ETF Execution Space

February 3, 2016 MarketsMuse Curator Leave a comment

Fixed Income trading platform TradeWeb, best known for its dominant role administering OTC government securities trading between global banks and institutional customers is muscling into the world of ETFs. Tradeweb has just launched an electronic over-the-counter marketplace for trading exchange traded funds using a “request-for-quote” aka “RFQ”- based platform that is modeled after a platform Tradeweb successfully launched in Europe in 2012.

Tradeweb’s new U.S. platform is designed to be a fully-automated alternative to phone- and chat-based over-the-counter ETF trading of institutional-sized or less liquid orders. Tradeweb clients can use the platform to send RFQs to up to five dealers at a time, using either one- or two-way price quotes. The platform offers aggregated pre-trade price transparency from liquidity providers and National Best Bid and Offer exchange pricing. The platform can also seamlessly connect to third-party and proprietary order management systems, and risk management systems to enable market participants to fully automate workflows. There are now 11 leading liquidity providers on the platform, according to a company announcement.

In Europe, where ETF liquidity is relatively fragmented, Tradeweb’s platform has become one of the largest pools of ETF liquidity. The European platform supports more than 45 percent of OTC electronic trading and the platform’s daily volume exceeds €500 million (approximately $5.6 million) per day. In the U.S., ETF liquidity that trades on exchanges is more centralized, but Tradeweb’s platform is the first fully-electronic platform for trading institutional-sized or less liquid orders through dealers.

“The Tradeweb ETF platform offers a new channel for liquidity and enhances our suite of execution capabilities,” said Chris Hempstead, head of ETF sales for KCG. “The platform represents a novel approach to improving price discovery as well as an innovative way to execute larger-size trades, while reducing the risk of materially impacting pricing.”

Institutions were early adopters of ETF and now hold about 34 percent of U.S. ETF assets, according to November data from State Street Global Advisors and Broadridge. As institutional OTC trading of ETFs continues to grow, market participants say pre-trade transparency into institutional-sized liquidity, and more streamlined, automated workflows are a next step.

“Leveraging electronic solutions to streamline over-the-counter trade workflows is an important step forward for the ETF industry. The combination of a robust exchange traded marketplace with an electronic, transparent OTC market delivers institutional investors choice in how they access liquidity,” said Leland Clemons, managing director at BlackRock iShares.

Tradeweb clients in the U.S. will be able to use the new platform to access all U.S.-listed ETFs, including fixed income ETFs, as well as European-listed ETFs.