Eurex Bonds – the electronic trading platform operated jointly by Eurex and the major bond-trading houses – has introduced a pre-arranged trade facility. In the first three trading days approximately Euros 500 million (single counted) was traded through it.
Deutsche Borse says that, with the new functionality, trading participants at Eurex Bonds can now enter trades that have been pre-arranged in the OTC market outside of the existing quote book. The facility is available for all bonds tradable on Eurex Bonds and for all basis instruments on German government bonds with a remaining term to maturity of more than one year. It is being made available to all trading participants of Eurex Bonds “as a matter of principle.”
Eurex says it introduced the facility because in professional bond trading, larger volumes in bond or basis trading (block trades), arbitrage transactions in individual bonds (spread trades) and arbitrage transactions between bonds and futures (basis trades) are often arranged bilaterally by the trading participants prior to execution via the Eurex Bonds trading system. By offering a controlled, flexible and user-friendly input functionality, Eurex Bonds hopes to capture more rading activity