BondHub™ – Fixed Income Data Integration Platform

BondHub™
Fixed Income Data Integration Platform

As competition in the marketplace increases and regulatory reporting times decrease, fixed income trading firms must automate and improve their efficiency or they will be left behind. Traders want to maximize exposure of fixed income quotes and RFQs across multiple trading venues while maintaining the ability to execute instantaneously without the risk of overselling inventory. They want choices for security reference data and pricing vendors. They want to see market orders, quotes, and RFQs collected in one place. The operations staff wants trades to automatically flow through to the clearing vendor to meet reporting and compliance requirements. And, management wants to see increased trading volume and higher profits.

Responding to these challenges often requires integration and interaction between multiple computer systems – both internal and external to the firm. The solution to this fixed income electronic trading problem is our fixed income data integration platform, BondHub. BondHub acts as an Integration As A Service (IAAS) platform for the bond market – centralizing access to electronic trading, clearing vendors’ trade reporting, reference data sources, and historical and evaluated pricing data sources. 

Primary uses of the BondHub service portal currently include:

  • Publish Quotes (bids & offers)
  • Publish RFQs (bids wanted & offers wanted)
  • Publish Trade Reports
  • Publish / Receive Trade Notification (Drop-Copy)
  • Execute Orders (at list, negotiated)
  • Receive Market Quotes
  • Receive Market RFQs
  • Receive Security Reference Data*
  • Receive Historical Trade Pricing*
  • Receive Evaluated Security Pricing*

Enterprise System Integration

Fixed Income Routing Engine

 

Product Overview

The BondHub service portal includes a suite of system integration and routing solutions that address the interfacing requirements between trade order management systems, clearing vendors, and multiple fixed income Electronic Communication Networks (ECN’s), Alternative Trading Systems (ATS’s), and Inter-dealer Brokers (IDB’s) and Market Data vendors.

BondHub supports a variety of standard and proprietary communication protocols to interact with the various sources – including API, which uses the Financial Information Exchange (FIX) protocol, SOAP, and others. Internal messaging protocols or proprietary data formats that are used by connected systems are translated into or out of their native protocol as necessary.  Additionally, our WebSocket API is used to communicate with our BondPub™ system along with other external dealer systems.  This architecture allows the flexibility for our clients to communicate freely with all sources using a single BondHub API rather than dealing with the disparate protocols of each different source.

Publish Quotes (bid & offers)

Traders may publish executable quotes from their internal trading system or through an API simultaneously across major ATS platforms such as Tradeweb Direct, ICE BondPoint, ICE TMCBonds, MuniBrokers, MTS BondsPro and Bloomberg. BondPub assures the broadest distribution of the bond bids and offerings as the users on each ATS receive the quotes simultaneously.

Example:

An offering quote is published and a ‘list price’ bid is received from one ATS.

The BondHub server ensures that an updated offering quote for a reduced quantity is immediately sent to all ATS’s so that the position is not oversold. Then, the system either auto-accepts the order or delivers the bid to the trader’s desk for manual confirmation.

Publish RFQs (bids wanted & offers wanted)

A bid-wanted RFQ is published by a trader to one or more connected trading venues. Bids are received through the venue for a defined period. The trader that published the RFQ determines whether to accept the high bid or withdraw from the auction. If the high bid is accepted, the trade is confirmed to all parties.

Publish Trade Reports

BondHub offers straight-through processing (STP) capabilities that can streamline post-trade reporting of trades. Once an order is executed, the trade report is formatted to the required specification and routed to the clearing service or other system. This instantaneous processing assures that the firm can meet regulatory and compliance reporting time requirements without any manual involvement of trading or operations staff.

A component of the BondHub service portal, referred to as the clearing gateway, is used to communicate with the various clearing vendors. The clearing gateway translates the trade message to the proprietary communication protocol used by the firm’s clearing provider (for example, Pershing’s UTF format) and routes to the clearing firm for processing. Acknowledgments and other alerts messages from the clearing provider are translated and routed back to the trader for storage or processing locally.

Publish/Receive Trade Notification (Drop-Copy)

BondHub can be configured to receive and route drop-copy trade notifications from external vendors such as one or more ATSs or Bloomberg VCON. Once received and routed, these trade notifications can be enriched and route back through BondHub to the clearing gateway for trade reporting. BondHub also has the ability to send drop-copy trade notifications to in-house or external system vendors for trades processed through the clearing gateway.

Execute Orders (at list, negotiated)

The ordering and confirmation process is different for every ATS and trading venue. BondHub normalizes the order confirmation conversation between all of these different processes so that a trader can interact with orders from a variety of venues in a consistent manner. Both ‘at list’ price orders and negotiated or ‘bid back’ price orders are supported.

Receive Market Quotes

BondHub can be configured to aggregate market quote feeds from multiple external sources, normalize or transform them, and then deliver them in a consistent format through an API so that recipients can respond and interact with them.

Receive Market RFQs

In the same way, BondHub can be configured to aggregate market RFQ feeds from multiple external sources, normalize or transform them, and then deliver them in a consistent format through an API so that recipients can interact with them.

Receive Security Reference Data

BondHub’s integration and transformation capabilities can also be used to integrate with security reference data sources, normalize or transform data into common structures, and deliver security reference data through an API so that recipients can utilize the data.

Receive Historical Trade or Evaluated Security Pricing

BondHub can be integrated with historical trade price or evaluated security price data feeds and deliver those prices through an API for use.