Why Electronic Junk-Bond Trading Is Surging

The video discusses the evolution of electronic trading in the fixed income market, highlighting the shift from traditional dealer-client models to all-to-all market solutions. The COVID-19 pandemic accelerated this change, leading to increased market share and liquidity. The benefits of electronic trading include tighter spreads and significant cost savings for clients. The growth of ETFs is also driving electronic adoption. The changes are expected to be lasting, with increased market velocity and new trading strategies emerging.

What was the market share of electronic trading in the high yield market in 2020?

• 10%

• 17%

• 25%

• 30%

How did the all-to-all market solution impact market spreads?

• Spreads disappeared

• Spreads tightened

• Spreads remained the same

• Spreads widened

What was the total savings for institutional clients on the platform in 2020?

• 2 billion

• 500 million

• 1.1 billion

• 687 million

What effect does electronic trading have on market velocity?

• Decreases velocity

• No effect

• Increases velocity

• Stops trading

How do ETFs contribute to the evolution of electronic trading?

• They decrease electronic adoption

• They have no impact

• They drive electronic adoption

• They replace corporate bonds