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Tradeweb, a global operator of electronic marketplaces for rates, credit, equities, and money markets, has reported a rise in repo trading activity for December 2021.
Repo average daily volume (ADV) was US$314.0 billion, a 3.1 per cent increase for the month of December compared to December 2020.
The addition of new clients on the platform continued to support growth in global repo activity, even as record usage of the Fed’s reverse repo facility weighed on the overall repo market, says Tradeweb.
Furthermore, retail money markets activity remained pressured by the low interest rate environment.
For fixed income trading, US government bond ADV on Tradeweb increased 23.6 per cent YoY to US$113.7 billion and European government bond ADV climbed 7.4 per cent YoY to US$21.9 billion.
This was driven by strong client activity in institutional and wholesale markets, along with the addition of the Nasdaq fixed income business on Tradeweb and the strong performance of session-based trading and streaming protocols.
For selected equities highlights, US exchange-traded fund (ETF) ADV increased 73.7 per cent YoY to US$7.9 billion. The European ETF ADV saw a 27.6 per cent rise YoY to US$2.6 billion.
The continued growth in institutional client activity contributed to higher volumes. Elevated market activity boosted volumes in both the US and Europe ETF volumes.
Tradeweb reports a total trading volume for December 2021 of US$20.0 trillion across electronic marketplaces for rates, credit, equities and money markets.
In US credit trading, high grade TRACE market share was 21.4 per cent, of which 13.0 per cent was transacted fully electronically. The US high yield TRACE market share was 10.4 per cent, of which 7.4 per cent was transacted fully electronically.
Lee Olesky, Tradeweb CEO, says: “Tradeweb facilitated record trading volume in 2021, exceeding US$1 trillion in average daily volume and culminating with a record fourth quarter. This was a breakthrough year for us in credit, fuelled by Tradeweb’s electronic portfolio trading and other innovations such as AiEX and sweep. Interest rate volatility around the world contributed to higher volumes in government bonds and swaps globally.
“Looking across asset classes, trends in passive investing drove strong interest in our ETF and credit platforms, while increased automation played a powerful role in all of our markets. 2021 represented a clear inflection point in the long-term trends towards more electronic trading.”
