Fixed income is rapidly evolving, with the help of technology. We examine some of the key trends that are influencing the way professionals work.
- As manual processes become increasingly inefficient and uncompetitive in a digital world, trading desks need to improve their efficiency.
- The fixed income asset class is undergoing significant evolution, as technological innovation and automation continue to reshape finance.
- The evolution is being driven by trusted technology powered by high-quality data.
Within fixed income, change is happening at an accelerated pace. Technology innovation and automation are reshaping the asset class and fundamentally changing the way professionals in the field perform their everyday jobs.
Earlier this year, we published a report on the Evolution of Trading in partnership with Coalition Greenwich, showcasing the rapid growth of automation within the fixed income world. Workflow efficiency has become top of mind and improving the quality of these processes from end to end is key.
Technology-enabled workflows are one of the areas of focus for fixed income, and trusted technology, empowered by broad, deep and high-quality data, is a key driver of change in this space.
Addressing workflows from end to end
Manual processes have become increasingly inefficient and uncompetitive in a digital world.
Trading desks need to simplify workflows and increase automation to improve efficiency, enhance performance, better mitigate risk, and ultimately lead to greater profitability.
From reducing the number of clicks to improving transparency, organisations and financial services are looking to develop content and structure throughout the entire trade lifecycle.
The theme of improving workflows was a focal point at the FILS USA conference in Nashville in June. I was part of a panel focused on how desktop interoperability tools can support traders, particularly around execution management systems (EMS), which is important given the advent of FDC3 becoming a trading industry standard.
The panel, which represented a microcosm of the industry, reached a consensus that EMS providers simply don’t do enough to provide for improved workflows.
Although there are multiple benefits associated with cross-functionality and accurate data, EMS, order management systems (OMS) and portfolio management systems (PMS) need to be combined into a consolidated solution. Executions cannot effectively be facilitated without seamless interoperability.
LSEG’s acquisition of TORA, a leading cloud-based technology provider, supports customers trading multiple asset classes across global markets through just such a solution.
TORA offers trading technology solutions, including EMS, OMS and PMS, for customers trading equities, fixed income, FX, derivatives and digital assets. Combining the power of TORA software with LSEG’s rich data and analytics capabilities delivers a highly differentiated trading solution with multi-asset class capabilities.
Low-code/no-code, Python and the cloud
On the question of build versus buy, the panel believed harnessing the best of both will deliver the optimal solution.
While traders are keen to further develop analytics and share thought leadership for improving workflows, it can be challenging to translate ideas into actionable projects that can be delivered within a reasonable timeframe.
The emergence of low-code/no-code applications or Python-based, user-friendly tools is helping to streamline the process of idea generation to usable solutions on the desk. These solutions help to remove the complexity that has traditionally been associated with building modern apps that suit the needs of today’s business.
Customising workflows and apps to suit their needs will empower investment professionals to adapt and respond more quickly to rapidly changing business conditions.
Refinitiv’s CodeBook gives developers access to a cloud-hosted environment for Python scripting, enabling them to leverage the Refinitiv Data Platform APIs to rapidly build and deploy models, apps and analytics that fit your workflow needs.
Even if you have no coding skills, the interface has been designed to give you the ability to design your own data models or access Python applications built by your colleagues, while providing access to our APIs and platform services in a single interface. This allows you to build analytics, applications and other use cases that are critical for your daily workflow needs.
Data underpins it all
The fixed income asset class is undergoing significant evolution as technological innovation and automation continue to reshape finance.
This evolution also extends to other asset classes, including leveraged loans and collateralised loan obligations (CLOs), where enhanced workflows, greater automation and access to low-code/no-code environments are extending access to electronic trading.
The ultimate goal is to improve the efficiency of workflows, to improve agility and profitability. Key to this evolution is the data that is the basis of digital transformation, which is what underpins the ability to automate and improve processes end to end.
LSEG, through various product sets and businesses including TORA and Refinitiv CodeBook, offers unsurpassed depth and breadth of data and innovative solutions to support this shift.
Republication or redistribution of LSE Group content is prohibited without our prior written consent.
The content of this publication is for informational purposes only and has no legal effect, does not form part of any contract, does not, and does not seek to constitute advice of any nature and no reliance should be placed upon statements contained herein. Whilst reasonable efforts have been taken to ensure that the contents of this publication are accurate and reliable, LSE Group does not guarantee that this document is free from errors or omissions; therefore, you may not rely upon the content of this document under any circumstances and you should seek your own independent legal, investment, tax and other advice. Neither We nor our affiliates shall be liable for any errors, inaccuracies or delays in the publication or any other content, or for any actions taken by you in reliance thereon.
Copyright © 2023 London Stock Exchange Group. All rights reserved.
The content of this publication is provided by London Stock Exchange Group plc, its applicable group undertakings and/or its affiliates or licensors (the “LSE Group” or “We”) exclusively.
Neither We nor our affiliates guarantee the accuracy of or endorse the views or opinions given by any third party content provider, advertiser, sponsor or other user. We may link to, reference, or promote websites, applications and/or services from third parties. You agree that We are not responsible for, and do not control such non-LSE Group websites, applications or services.
The content of this publication is for informational purposes only. All information and data contained in this publication is obtained by LSE Group from sources believed by it to be accurate and reliable. Because of the possibility of human and mechanical error as well as other factors, however, such information and data are provided "as is" without warranty of any kind. You understand and agree that this publication does not, and does not seek to, constitute advice of any nature. You may not rely upon the content of this document under any circumstances and should seek your own independent legal, tax or investment advice or opinion regarding the suitability, value or profitability of any particular security, portfolio or investment strategy. Neither We nor our affiliates shall be liable for any errors, inaccuracies or delays in the publication or any other content, or for any actions taken by you in reliance thereon. You expressly agree that your use of the publication and its content is at your sole risk.
To the fullest extent permitted by applicable law, LSE Group, expressly disclaims any representation or warranties, express or implied, including, without limitation, any representations or warranties of performance, merchantability, fitness for a particular purpose, accuracy, completeness, reliability and non-infringement. LSE Group, its subsidiaries, its affiliates and their respective shareholders, directors, officers employees, agents, advertisers, content providers and licensors (collectively referred to as the “LSE Group Parties”) disclaim all responsibility for any loss, liability or damage of any kind resulting from or related to access, use or the unavailability of the publication (or any part of it); and none of the LSE Group Parties will be liable (jointly or severally) to you for any direct, indirect, consequential, special, incidental, punitive or exemplary damages, howsoever arising, even if any member of the LSE Group Parties are advised in advance of the possibility of such damages or could have foreseen any such damages arising or resulting from the use of, or inability to use, the information contained in the publication. For the avoidance of doubt, the LSE Group Parties shall have no liability for any losses, claims, demands, actions, proceedings, damages, costs or expenses arising out of, or in any way connected with, the information contained in this document.
LSE Group is the owner of various intellectual property rights ("IPR”), including but not limited to, numerous trademarks that are used to identify, advertise, and promote LSE Group products, services and activities. Nothing contained herein should be construed as granting any licence or right to use any of the trademarks or any other LSE Group IPR for any purpose whatsoever without the written permission or applicable licence terms.