The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Patrick Moley - Piper Sandler Companies - Analyst
: So you released metrics this morning. Maybe we'll start there. Any takeaways, any high-level things that you think are worth calling out?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: And that was going to be my next question based on the macro you mentioned. How low spread, but low spread volatility has impacted you run
into some market share as you can you talk about the impact that the environment has had over the last several quarters and your expectations,
if we do get a little bit of a pickup in volatility, how you'd expect that to impact the business?
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JUNE 05, 2024 / 2:00PM, MKTX.OQ - Marketaxess Holdings Inc at Piper Sandler Global Exchange and Trading
Conference
Question: Patrick Moley - Piper Sandler Companies - Analyst
: I think, you might be right there. So there's a number of new initiatives that you've been working on to kind of address some of the share headwinds
you've run into. You've introduced X-Pro, which is kind of the EMS front end system and that can access a delivery mechanism for a lot of the new
initiatives. Can you talk about the ways that you're leveraging that to address these issues? And can you walk us through kind of where we are in
terms of the overall product rollout there?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: Sure. So on portfolio trading, I want to ask you where do you think overall it's headed from here? I think we're at as a percentage of overall market
volumes around 10% currently. How big do you think that number can get? And if we do get some choppiness here and spreads widen out, do
you think that number return back down to the 5% range is sort of been over the last several years or do you thing that's sort of a continues adoption
trend --
Question: Patrick Moley - Piper Sandler Companies - Analyst
: Yeah, so with that ongoing innovation and if it does continue to grow it as a percentage of market volumes, you think that the capabilities and the
functionality that you offer through X-Pro today are enough to compete with some of the other players out there. Do you think you would potentially
look to pull some other levers like pricing in order to kind of remain compelling there?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: Can we maybe unpack that a little bit, like what are those kind of things that you're thinking about in terms of differentiation?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: Sure. And Chris, on the last call, kind of talked about this idea there is a longer term market opportunity sort of shifting in your favor he thought.
He was talking about these larger trade sizes getting broken down, run through RFQ to higher fee per million, and that's going to increase trading
velocity. So can you just talk about how you expect that to evolve? And maybe just elaborate on some of those items of why you think that it's
shifting in your favor?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: So maybe switching gears, looking internationally, you've seen a lot of strength recently in Eurobonds in emerging markets. In the first quarter,
you saw record ADV in both. What do you think's driving the success there? And maybe you could touch on just how these markets differ from the
US in terms of customer mix, protocol utilization?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: Maybe bringing it back over to the US and kind of taking a step back. On the competitive landscape, what's the current state of play in the US?
What are your thoughts on that? Can you just give us a state of the union on how you think about the overall competitive landscape in US credit,
maybe specifically high-yield, where you've seen share kind of compressed from where it was last year?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: I think a lot of that, it's going to help drive electronification, which leads me to my next question. Probably last question here. What are your thoughts
just on the pace of electronification we've seen? And what could be the next catalyst that kind of gets us over the next hurdle toward sort of the
next step up an electronification? How do you think about that?
Question: Patrick Moley - Piper Sandler Companies - Analyst
: All right. Well, I think that's time Rich. Thanks so much for joining us.
without the prior written consent of Thomson Reuters. 'Thomson Reuters' and the Thomson Reuters logo are registered trademarks of Thomson Reuters and its
affiliated companies.
JUNE 05, 2024 / 2:00PM, MKTX.OQ - Marketaxess Holdings Inc at Piper Sandler Global Exchange and Trading
Conference
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