Bulge-bracket dealers are increasing their dealings with middle-market investors in agency debentures due to a new function on an electronic trading platform. Thomson TradeWeb recently started commingling its inventory of agencies, which now offers investors access to nine participating sell-side firms.
A trader at a large dealer said in the near term, the new function could pique the interest of investors who do not usually deal with the bulge brackets and decrease smaller firms' share of the pie. He added the increased transparency could also attract more investors to the agency market in the long term.
Ian Burdette, agency syndicate trader at Goldman Sachs said he had seen an increase in interest from middle market accounts, such as regional dealers and mid-sized domestic U.S. banks. "We're seeing inquiry from middle markets that we wouldn't necessarily see," Burdette said. He declined to quantify the increase.
