Man Financial, the U.K.-based futures broker, has implemented SDS Financial Technologies' alternative trading system (ATS) and launched its Man E-Finance Fixed Income Marketplace.The online marketplace, which is currently available to 20 of Man Financial's hedge fund clients in the U.S., supports a range of FIX connections for order routing and price dissemination. The platform's functionality will initially cover the trading of U.S. Treasury repurchase agreements (Repos), with other products expected to be added down the line.
Brad Bailey, senior analyst at Aite Group, says that while Wall Street is littered with the corpses of many electronic bond platforms, things may be looking up for fixed income. He says that 2006 saw a "tremendous amount of electronic connectivity in the fixed-income markets."
Bailey adds that the Repo market, being very structured and efficient to begin with, makes sense as a good place to start with an ATS.
"It's an interesting idea for the Repo market, especially if the people involved are doing a sufficient amount of business together where they can repo or reverse repo with one another even more efficiently," says Bailey. He also foresees even more opportunity to add transparency in the general collateral management, securities lending and repo markets across the board. "This could a good step in that direction," Bailey says.
Man Financial will also be taking its fixed-income ATS overseas, with a European version of the marketplace in the works for late 2007.