Fixed-income dealers’ response to long-term challenges facing the industry could be working to the advantage of global investors, according to Greenwich Associates’ research.
The firm says that as most banks around the globe face pressure to increase profitability, they are increasingly competing among a small set of dealers, new liquidity providers and, to some extent, electronic trading platforms for a share of existing clients’ volumes and revenues. That competition is fuelling innovation by banks seeking an edge over rivals and benefiting investors in the form of new and better digital products and tools.
“The 2019 Greenwich share and quality leaders in global fixed income are at the forefront of the investment and innovation that is revolutionising global bond markets,” says Greenwich Associates Managing Director James Borger.
At the top of that list of 2019 Greenwich share leaders is Citi, which bests all dealers in overall global fixed income market share. JP Morgan is next, followed by Goldman Sachs, Morgan Stanley and, finally, BoA Securities and Barclays, which are tied for the number five spot. Other dealers are successfully focusing on areas of relative strength, Greenwich says, with HSBC topping the list of share leaders in fixed income – emerging markets alongside Citi, followed by JP Morgan.
Citi and JP Morgan have been unveiled as the 2019 Greenwich quality leaders in overall global fixed income service. These two banks also share that designation for both global fixed income sales and global fixed income trading quality, while JP Morgan alone claims the title of 2019 quality leader in global fixed income research.
The Greenwich report also identifies electronic trading and the digitisation of new issues as key changes in the marklet structure in fixed income, it also highlights that portfolio trading is accelerating and that ESG investing is creating new opportunities for dealers.