Expanding its cross-asset liquidity solutions, smartTrade Technologies is launching smart-FI today. The product is aimed at becoming an end-to end solution for the fixed income and OTC derivative sector. At its core, smart-FI provides customers such as banks and brokers the ability to connect and aggregate fixed income liquidity from multiple sources such as SEFs and dealers and make them available to their customers.
Similar to FX liquidity technology, smart-FI provides the ability for aggregated pricing to be customized for different bank and broker customers, as well as offering market-making features. For buy-side users, this means that smart-FI provides an all in one product to connect and trade with multiple fixed income sources using an aggregated feed of pricing. While for the sell-side, smart-FI offers the ability to resell aggregated liquidity to customers, or as a reference price to make a market in fixed income securities to clients or multi-dealer platforms.
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In an interview with Forex Magnates, David Vincent, CEO of smartTrade Technologies, summed up the product by stating, “smart-FI takes what is being done in FX and brings it to liquid fixed income products.” Vincent explained that we are currently in a period of ‘electrofying’ the fixed income market. As such, whether via or regulated venues like SEFs, or accessing fixed income liquidity directly from individual banks or dealers, “the trend is towards FIX connectivity, supported by the success of the TESI.”
According to Vincent, the result for the fixed income market is that by using technology we are now able to connect together multiple liquidity sources into aggregated feeds of pricing. Like the FX sector, as a primarily OTC market, fixed income trading is also fractured with liquidity being made available on various SEFs or directly from dealers and banks. In the fixed income’s case, part of the push to unify the market has been driven by the establishment of industry-wide protocols, such as the Trading Enablement Standardization Initiative (TESI) in 2013. Developed by the FIX trading community, TESI’s first achievement was the release of FIX messaging support for the fixed income market, followed by FX products earlier this year.
With smart-FI, the fixed income product integrates with smartTrade’s other cross-asset liquidity solutions and their front-end white label platform, as well as via API to external multi-dealer platforms. According to smartTrade, using smart-FI, users will be able to seamlessly offer fixed income and SEF trading to their end user customers along with existing assets connected to the platform. The solution also includes an algo engine for dynamic distribution of pricing to clients and external sources.