Trading systems provider, TS Imagine, has connected to municipal bond market maker TDS Automated Trading (TDSAT), through its TradeSmart Fixed Income execution management system (EMS).
TDSAT, previously known as Headlands Tech Global Markets, operates as a fully automated electronic market-maker in municipal and investment grade corporate bonds. TDSAT employs data-driven strategies to find value-added electronic solutions for clients.
“TDSAT is excited to be working with TS Imagine to deliver real-time municipal bonds liquidity to the buyside community,” said Marty Mannion, co-head of TDSAT. “We continue to be impressed with TradeSmart’s ability to develop and implement advanced execution capabilities that help clients adapt to a rapidly changing fixed income landscape.”
The development of separately managed accounts (SMAs) has allowed the individual holding of securities by US investors, but created complexity for the investment managers responsible for overseeing these accounts. This has increased the demand for technology that can support the investment process through pre-trade to post-trade says Spencer Lee, chief markets officer and head of fixed income at TS Imagine.
“There are so many security types in the municipal market, with many different attributes, issuers and coupon differentials,” said Lee. “These attributes become very significant for the buy side as it manages these different SMAs and the themes that these SMAs want to pursue. You really need to provide a systematic framework to support the liquidity search to fit your investment theme. The automated liquidity search that we developed includes all of those muni-specific attributes, allowing an attribute- and liquidity-based search with automated execution once the securities are found.”
In addition to connecting the buy-side with fixed income dealers directly, TradeSmart captures pricing information, dealer quotes and trade data.
“With our existing client base, data acquisition is rapidly becoming almost the primary benefit,” said Lee. “They have to contend with a very fragmented, dispersed data acquisition methodology, with as much time spent collecting, curating and storing as analysing. Many of our clients are benefiting from the centralised hub that we represent to connections in the liquidity marketplace, receiving that data through one centralised pipe, where it’s stored and curated on their behalf.”
The TDSAT announcement is the latest in a series of developments regarding TradeSmart Fixed Income. Last month, TS Imagine announced the integration of LTX, an AI-powered fixed income trading platform, to offer mutual buy-side clients improved pre-trade transparency, price discovery and access to aggregated liquidity within their existing workflows. Earlier this year, TS Imagine announced its connection to ICE Bonds to offer clients access to its fixed income execution protocols and liquidity, including trading protocols for municipal bonds and corporates, across the ICE TMC and ICE BondPoint platforms.
“Over the past 25 years, TradeSmart has built a broad network of over 250 listed brokers, dealers, venues and algos, cementing its status as an essential gateway for liquidity seekers across asset classes,” said Lee. “The addition of TDSAT marks a significant milestone in the electronification of municipal bond markets, as we witness increasing technology adoption in the broader fixed income market.”
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