Portfolio trading share in Europe’s investment grade market could get closer to that of the US from its current 10–12% level to as much as 18–20% within the next three years.
In its latest research report Barclays shows that portfolio trading in Europe’s corporate bond market is surging, Zornitsa Todorova, head of thematic fixed income research at Barclays analysed public trade records with an inhouse algorithm and identified more than 10,000 European portfolio trades between November 2022 and November 2024.
The study indicates that a new portfolio trade (PT), which consolidates multiple securities into a single transaction rather than trading them individually, now occurs every twenty minutes across the region, pushing annual transaction volumes to over €250 billion in 2024—a 74% increase compared to the previous year.
The report notes that portfolio trading has secured an 11% market share in the euro-denominated investment-grade segment while also making inroads into less liquid markets. It now represents 7% of dealer-to-client volumes in euro high yield and 9% in sterling bonds. Each portfolio trade typically aggregates around 60 bonds with a total notional value of approximately €40 million.
Comparatively, in the United States, a new portfolio trade is executed every seven minutes; PT accounts for 25% of the investment-grade market and 16% of the high-yield market.
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