Electronic trading in the fixed income markets
So I checked out the TRACE website the other evening, after following up Accrued‘s post. There are different rules for reporting blocks, obviously designed to protect dealers offering block liquidity.
Yeah, they can usually mask the real size on large trades. Also, most bonds that require real price discovery, like bonds with unusual coupon structures or call features, are not TRACE eligible. PLUS, those are exactly the type of bonds that are usually sold to retail investors.
Thanks for that insight Tom – I’ve had some contact with the structured notes business recently, and realised there’s not so much price transparency there, especially for retail.
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