Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator
of electronic marketplaces for rates, credit, equities and money
markets, today announced it has completed the first fully
electronic institutional Secured Overnight Financing Rate (SOFR)
swap spread trade. BlackRock and J.P. Morgan were counterparties to
the trade on the Tradeweb Swap Execution Facility (TW SEF).
As markets globally transition from using IBOR rates toward a
new reference rate, market participants have been accessing growing
liquidity in alternative risk-free rates (RFRs) and have begun to
trade increasingly in SOFR. In the U.S., the Alternative Reference
Rates Committee (ARCC) has identified SOFR, which is administered
by the Federal Reserve Bank of New York, as the rate that
represents best practice for certain new USD derivatives and other
financial contracts. In time, the increased adoption of RFRs
including SOFR will help the market migrate away from IBOR.
Lee Olesky, CEO at Tradeweb said: “The global transition away
from IBOR usage is a significant undertaking and is important to
our market participants across various asset classes. Providing the
tools and platforms that help foster electronic trading and
coalesce liquidity around rates like SOFR is an area where we can
be immediately helpful to our clients. We are proud to bring the
full power of the Tradeweb platforms and network to bear as the
industry moves toward critical deadlines.”
The Tradeweb team is working with clients around the world to
help increase liquidity and encourage robust RFR markets across
currencies, including those for USD SOFR, GBP SONIA, CHF SARON, and
JPY TONA. To help smooth the transition to new RFR rates, and in
addition to offering trading, Tradeweb enables its clients to
upload existing IBOR portfolios directly into the platform’s list
trading tool and convert them to the new rates in a process that
also helps achieve best execution.
Thomas Pluta, Global Head of Linear Rates Trading at J.P. Morgan
said: “As the ‘SOFR First’ date of July 26 rapidly approaches in
the derivatives market, we are encouraging our clients to
transition their trading away from LIBOR. Executing the first SOFR
Swap Spread over Tradeweb is an important market milestone as SOFR
liquidity and market volumes continue to grow.”
Market participants manage dollar interest rate risk chiefly
through the treasury market, treasury futures, and interest rate
swaps trading. A swap spread trade allows participants to
efficiently transform interest rate risk expressed in the cash
market to swaps, which also serves to link the liquidity between
the two markets. This provides investor and traders with
optionality and surety as they transact and hedge each day. Swap
spread trades are considered a structurally important segment of
the interest rates derivatives market, and represent approximately
10% of the USD derivatives market.1
Tradeweb launched interest rate swap trading in 2005, and
numerous market firsts have been executed on the firm’s
award-winning SEF, including the first electronic swap compression
trade, electronic swaptions trading, electronic cleared inflation
swap and multi-asset package trades.
About Tradeweb Markets
Tradeweb Markets Inc. (Nasdaq: TW) is a leading, global operator
of electronic marketplaces for rates, credit, equities and money
markets. Founded in 1996, Tradeweb provides access to markets, data
and analytics, electronic trading, straight-through-processing and
reporting for more than 40 products to clients in the
institutional, wholesale and retail markets. Advanced technologies
developed by Tradeweb enhance price discovery, order execution and
trade workflows while allowing for greater scale and helping to
reduce risks in client trading operations. Tradeweb serves
approximately 2,500 clients in more than 65 countries. On average,
Tradeweb facilitated more than $920 billion in notional value
traded per day over the past four quarters. For more information,
please go to www.tradeweb.com.
Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the federal securities laws. Statements related to,
among other things, our outlook and future performance, the
industry and markets in which we operate, our expectations,
beliefs, plans, strategies, objectives, prospects and assumptions
and future events are forward-looking statements.
We have based these forward-looking statements on our current
expectations, assumptions, estimates and projections. While we
believe these expectations, assumptions, estimates and projections
are reasonable, such forward-looking statements are only
predictions and involve known and unknown risks and uncertainties,
many of which are beyond our control. These and other important
factors, including those discussed under the heading “Risk Factors”
in documents of Tradeweb Markets Inc. on file with or furnished to
the SEC, may cause our actual results, performance or achievements
to differ materially from those expressed or implied by these
forward-looking statements. Given these risks and uncertainties,
you are cautioned not to place undue reliance on such
forward-looking statements. The forward-looking statements
contained in this release are not guarantees of future performance
and our actual results of operations, financial condition or
liquidity, and the development of the industry and markets in which
we operate, may differ materially from the forward-looking
statements contained in this release. In addition, even if our
results of operations, financial condition or liquidity, and events
in the industry and markets in which we operate, are consistent
with the forward-looking statements contained in this release, they
may not be predictive of results or developments in future
periods.
Any forward-looking statement that we make in this release
speaks only as of the date of such statement. Except as required by
law, we do not undertake any obligation to update or revise, or to
publicly announce any update or revision to, any of the
forward-looking statements, whether as a result of new information,
future events or otherwise, after the date of this release.
______________________________
1 On a DV01 basis. Based on Clarus Financial Technology SDR
data.
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version on businesswire.com: https://www.businesswire.com/news/home/20210708005469/en/
Media contact Hannah Randall Akeel, +1 646 939 6198
Hannah.RandallAkeel@Tradeweb.com
Investor contact Ashley Serrao, Tradeweb + 1 646 430 6027
Ashley.Serrao@Tradeweb.com
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