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Fixed Income Trading: New venues

A simple question came up recently in a conversation – how many new Fixed Income trading venues are there?  I could not think of anywhere th...

Tuesday, 30 October 2007

Project “Utility” (October 30th 2007)

Another question from roving reporter John…putting me to shame in terms of the number of serious posts recently.
So, we live in a world where Investment Banks compete fiercely in most areas (a good thing) but also collaborate (ie Boat, Turquoise) when appropriate. And that’s sensible, horses for courses.

At the moment the sell-sides either buy or build their connectivity infrastructure and most have a mix of Fidessa, ORC, GL Trade, Cameron, TransactTools, Javelin (NYFIX) Appia and so on. On the buy side in the last five or six years there have only really been two choices – Charles River or LatentZero. And that lack of competition is a bad thing.
So, a modest proposal. Why don’t the heads of connectivity from Morgan Stanley, Merrill Lynch, Credit Suisse, Goldman Sachs, Lehman Brothers, Bear Stearns and so on stop buying EMS vendors and actually set up a broker neutral OMS/EMS. Neutral by design and by ownership. Genuinely FIX compliant and given to any buy-side that wants it – client of the owning banks or not. Charge it out on a rental model – a modest rental per dealer per month – maybe say $1,000??
Maybe even look to Open Source it for the hedgies and the funkier chaps with more tech smarts…
Or is that what the $180million investment in Thomson Tradeweb was all about?
 
Original post http://mostly.wordpress.com/2007/10/30/project-utility/

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