Credit market readies itself for algorithmic trading

The rise in e-trading has opened the way for the adoption of algorithmic trading, where large numbers of trades are executed automatically, according to pre-set parameters. But are clients ready and, more importantly, willing to accept such a change?

Andrew Challis, Barclays Capital: “Limit orders help clients”

Broach the subject of the introduction of algorithmic trading within the credit market with traders and you’re likely to get, at best, a lukewarm response. After all, credit – one of the largest markets in the global financial services industry – has been accused of dragging its heels when it comes to trade automation compared with other markets such as equities, foreign exchange, listed derivatives and futures.

John Jay, senior analyst at industry research firm Aite Group, says algorithmic