Multi-asset trading specialist Saxo Capital Markets has seen a significant reduction in spreads and lower execution time for fixed income securities thanks to its digital bond-trading solution.
According to the firm, which covers over 5,000 government and corporate bonds in both developed and emerging markets, the new technology enabled clients to redirect their orders into an auction pool of 40 of the largest liquidity providers in the world to compete for those orders in just a few seconds.
The clients also saw an improvement in spreads of more than 25 basis points and an improved execution speed, with the time limit for any bond trade in Saxo’s platform being 45 seconds.
Saxo Capital Markets’ chief executive, Ben Smoker, said that the new trading technology made it possible for retail investors and mid-size institutions to directly access fixed income securities without having to go through the hassle of manual execution processes.
“The manual bond trading processes can be a challenge in Australia,” he said.
“Up until the recent launch of the Saxo Digital Bond Trading offering, accessibility to bond trading for Australian investors has been limited to only a handful of manual process brokers offering a somewhat anaemic variety of bonds.
“Both the spread of a bond trade and the time it takes to execute can be instrumental factors to the performance of our clients’ portfolios and can make a huge difference to potential returns – both in fixed income-only portfolios, but also a part of a multi-asset portfolio.”
