Tradeweb Reports April 2024 Total Trading Volume of $41.9 Trillion and Average Daily Volume of $1.94 Trillion

Rhea-AI Summary

Tradeweb Markets Inc. reported a total trading volume of $41.9 trillion and an average daily volume of $1.94 trillion for April 2024, showing a significant increase year-over-year. The company saw positive growth across various sectors including rates, credit, equities, and money markets. The increase in trading volume was driven by client adoption, favorable market conditions, and robust primary issuances.

Positive

• Significant increase in total trading volume and average daily volume year-over-year

• Positive growth in U.S. government bond, European government bond, and mortgage trading volumes

• Strong performance in rates derivatives and swaps/swaptions trading volumes

• Record share in fully electronic U.S. High Grade TRACE for credit trading

• Growth in municipal bonds and credit derivatives trading volumes

• Institutional and retail activity driving robust trading volumes in various sectors

• Increased adoption of Tradeweb's electronic trading protocols across different asset classes

Negative

• None.

Insights

Financial Analyst

The reported 69.1% YoY increase in ADV at Tradeweb Markets is a significant indicator of the platform's growth and suggests an expanding user base or increased transaction size, or both. The growth in U.S. government bond ADV by 70.7% indicates heightened activity in the treasury market, likely driven by fiscal policies or market conditions affecting bond yields. Moreover, the 118.9% jump in swaps/swaptions ADV can be attributed to the current central bank policy decisions, which often lead to increased hedging activities by institutional clients. Investors should note that increased volumes in credit derivatives, up 65.0% YoY, may reflect a growing appetite for risk management tools amid credit market volatility. Strong performance in these areas can be a positive sign for Tradeweb's revenue, as higher volumes typically translate to increased transaction fees. Therefore, this report could be viewed favorably, reflecting robust platform engagement and a potentially positive outlook for Tradeweb's financial performance.

Market Research Analyst

The record shares of fully electronic U.S. High Grade and High Yield TRACE captured by Tradeweb suggest a solidifying position in the electronic credit market. This is indicative of a broader industry trend towards digitalization and efficiency in trade execution. For retail investors, the company's ability to capture a larger market share in these areas may result in competitive advantages and potential market leadership. Additionally, the growth in European government bond ADV points to Tradeweb's successful expansion efforts internationally, which diversifies its revenue streams and can reduce geographic concentration risk. Investors might consider these factors as promising for the company's future growth and stability.

Tech Industry Analyst

Tradeweb's success in increasing volumes across different protocols and asset classes, such as the TBA mortgage platform and electronic repo trading, highlights its technological prowess and innovation in financial markets. For investors, advancements in Tradeweb's electronic trading capabilities could signal long-term growth as technology continues to play a important role in financial markets' efficiency and accessibility. The mention of increased client activity and adoption of Tradeweb's RFQ protocol in institutional ETFs also underlines the platform's user-friendly nature and potential for further penetration in the trading community. This could suggest the scalability of the platform and a positive outlook on the company's ability to maintain technological leadership.

April 2024 ADV up 69.1% YoY

NEW YORK--(BUSINESS WIRE)-- Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today reported total trading volume for the month of April 2024 of $41.9 trillion (tn)¹. Average daily volume (ADV) for the month was $1.94tn, an increase of 69.1 percent (%) year-over-year (YoY).

In April 2024, Tradeweb records included:

• ADV in fully electronic U.S. High Grade credit
• Share of fully electronic U.S. High Grade TRACE
• ADV in global repurchase agreements

April 2024 Highlights

RATES

• U.S. government bond ADV was up 70.7% YoY to $205.3 billion (bn). European government bond ADV was up 23.9% YoY to $45.6bn.
  • U.S. government bond volumes were supported by growth across all client sectors. Increased adoption across a wide range of protocols and favorable market conditions contributed to the increase in volume. The addition of r8fin continues to contribute positively to wholesale volumes. Robust primary issuance across Europe and the UK helped drive trading volume in European government bonds.
• Mortgage ADV was up 34.8% YoY to $206.1bn.
  • The continuation of elevated roll activity, together with a spike in volatility, contributed to higher ADV on our To-Be-Announced (TBA) platform, while increased client adoption contributed to strong volumes in specified pool trading.
• Swaps/swaptions ≥ 1-year ADV was up 118.9% YoY to $475.7bn and total rates derivatives ADV was up 127.8% YoY to $796.0bn.
  • Strong volume in swaps/swaptions ≥ 1-year was driven by ongoing institutional client activity in response to current global central bank policy decisions, as well as a 137% increase in compression activity which carries a lower FPM. Quarter to date compression activity is trending lower than 1Q24. Clients continued to utilize the request-for-market (RFM) protocol for larger risk transfers, while inflation and emerging markets swap growth remained strong.

CREDIT

• Fully electronic U.S. credit ADV was up 96.1% YoY to $8.0bn and European credit ADV was up 19.4% YoY to $2.3bn.
  • Higher U.S. credit volumes were driven by increased client adoption, most notably in request-for-quote (RFQ), portfolio trading and Tradeweb AllTrade®. Tradeweb captured a record 19.7% share of fully electronic U.S. High Grade TRACE, and 7.3% share of fully electronic U.S. High Yield TRACE. Increases in European credit volumes were driven by continued client adoption of portfolio trading, unique dealer selection tools (SNAP IOI) and session-based trading.
• Municipal bonds ADV was up 20.8% YoY to $347 million (mm).
  • Volumes outpaced the broader market, which was up roughly 6% YoY². Institutional and retail activity was strong, with robust buyside activity amidst active issuance.
• Credit derivatives ADV was up 65.0% YoY to $15.3bn.
  • Increased credit volatility and credit default swap indices (CDX) roll trading led to increased swap execution facility (SEF) and multilateral trading facility (MTF) credit default swaps activity.

EQUITIES

• U.S. ETF ADV was up 24.8% YoY to $7.8bn and European ETF ADV was up 19.4% YoY to $2.8bn.
  • U.S. and European institutional ETF volumes continued to grow as more clients embraced Tradeweb’s electronic RFQ protocol. U.S. wholesale ETF volumes also increased as the customer base continued to expand.

MONEY MARKETS

• Repurchase agreement ADV was up 39.4% YoY to $598.2bn.
  • Increased client activity on Tradeweb’s electronic repo trading platform drove record global repo activity. The combination of quantitative tightening, increased collateral supply, and current rates market activity shifted more assets from the Federal Reserve’s reverse repo facility to money markets. Retail money markets activity was strong as markets priced in less aggressive Fed rate cuts.

Please refer to the report posted to https://www.tradeweb.com/newsroom/monthly-activity-reports/ for complete information and data related to our historical monthly, quarterly and yearly ADV and total trading volume across asset classes.

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 50 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 more than 2,500 clients in more than 70 countries. On average, Tradeweb facilitated more than $1.5 trillion in notional value traded per day over the past four fiscal quarters. For more information, please go to www.tradeweb.com.

Basis of Presentation
All reported amounts are presented in U.S. dollars, unless otherwise indicated. In determining the reported U.S. dollar amounts for non-U.S. dollar denominated securities, the non-U.S. dollar amount for a particular month is translated into U.S. dollars based on the monthly average foreign exchange rate for the prior month. Volumes presented in this release exclude volumes generated by (i) unbilled trial agreements, (ii) products billed on an agreement basis where we do not calculate notional value, and (iii) products that are not rates, credit, equities or money markets products. Please see the footnotes on page 3 of the full report for information regarding how we calculate market share amounts presented in this release.

Market and Industry Data
This press release and the complete report include estimates regarding market and industry data that we prepared based on our management’s knowledge and experience in the markets in which we operate, together with information obtained from various sources, including publicly available information, industry reports and publications, surveys, our clients, trade and business organizations and other contacts in the markets in which we operate. In presenting this information, we have made certain assumptions that we believe to be reasonable based on such data and other similar sources and on our knowledge of, and our experience to date in, the markets in which we operate. While such information is believed to be reliable for the purposes used herein, no representations are made as to the accuracy or completeness thereof and we take no responsibility for such information.

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 the 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. In particular, preliminary average variable fees per million dollars of volume traded are subject to the completion of management’s final review and our other financial closing procedures and therefore are subject to change. 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 events or performance and future events, 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 future events, 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 events, 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 Tradeweb acquired Yieldbroker on August 31, 2023 and r8fin on January 19, 2024. Total volume reported includes volumes from each acquired business subsequent to the date of the applicable acquisition.

² Based on data from MSRB

View source version on businesswire.com: https://www.businesswire.com/news/home/20240506802046/en/

Media:

Daniel Noonan, Tradeweb

+1 646 767 4677

Daniel.Noonan@Tradeweb.com

Investor:

Ashley Serrao, Tradeweb

+1 646 430 6027

Ashley.Serrao@Tradeweb.com

Sameer Murukutla, Tradeweb

+1 646 767 4864

Sameer.Murukutla@Tradeweb.com

Source: Tradeweb Markets Inc.