Neptune, the open standards network utility for pre-trade indications in bond markets, is continuing to expand its business to the wider community.
The network launched in August initially, with a limited set of buy-side and sell-side sponsors. Neptune has already seen strong growth in the amount of quality data flowing through the network enhancing pre-trade transparency for those market participants already signed up.
Neptune is now extending the fixed income pre-trade information network to the global financial community. With over USD16 billion of gross notional and nearly six thousand line items, referencing over four thousand ISIN’s across IG/HY/EM bonds, the platform is fast expanding from its initial focus of purely European IG/HY corporate bonds, to a portfolio that also reflects the global nature and reach of its user base.
Juan Landazabal, Global Head of FI & FX Trading, Deutsche AWM, says: “We are happy to see this project, a truly collaborative effort between the buy-side and sell-side, come to fruition. It is evidence that market participants can come together to create fair and efficient markets and is a step in the right direction towards increasing velocity and liquidity in the bond markets. We look forward to seeing the network of users expand to cover more fixed income markets across all regions.”
Brett Chappell, Head of Fixed Income Trading, Nordea Asset Management, says: “Traditional methods of data mining are static and incomplete. Neptune allows us to ascertain liquidity in real time, an important factor when making investment decisions. The technological ease of the system allows for seamless integration in our systems.”
Neptune offers a commoditised and open standard network that allows banks and investors to exchange controlled and targeted real-time axe and inventory using a robust data governance model. By focusing on the creation of a technology utility to exchange this information directly between market participants, Neptune enables greater transparency of trading interests across the marketplace between buyers and sellers of bonds – usually banks and investors such as fund managers, pension funds and asset managers.
The sell-side involved in the Neptune Collaboration are now sending pre-trade indications to their clients across the Neptune network to which the asset managers are connected directly via any combination of the Neptune GUI, their own in-house developed OMS or an external OMS provider. The flexibility of connectivity options means they will be receiving pre-trade indications from multiple banks in a standard format with a single connection.
Grant Wilson, Partner, Etrading Software, says: “We are pleased that the system is live and that the quality data within the system is already enabling trade generation. Enhancing the flow of electronic pre-trade information has been a focus of market participants for many years. For Neptune to have achieved this in a relatively short period of time is testament both to our core principles and simplicity and also to the tremendous support we have had from banks and asset managers who have collaborated closely with us and each other, in order to create an open standard, technology-based, non-profit utility.”
Neptune’s combination of data ownership, open-standard technology and collaboration creates an environment where the sell-side are comfortable delivering high quality, structured data to their clients. This will continue to be a core focus for the Neptune utility as the network grows.
Mark Bisker, EPAM, says: “Our collaboration with Neptune led to the development of a flexible and robust platform. We are proud of the technology we contributed and we are working on scaling Neptune to address growing demand to ensure success of the venture.”
Murray Reid, Partner, Etrading Software, says: “One of the huge attractions of Neptune is the underpinning technology. Selected from industry standard, state-of-the-art technical components, we’ve created a cost-effective, fungible stack. This commoditised structure drives competitiveness through substitutability and efficiency.”
