MKTX MarketAxess Holdings Inc

MarketAxess Holdings Inc. (Nasdaq: MKTX), the operator of a leading electronic trading platform for fixed-income securities, today announced trading volume and preliminary variable transaction fees per million (“FPM”) for August 2024.1

Chris Concannon, CEO of MarketAxess, commented: “A favorable market environment helped deliver strong year-over-year, and solid month-over-month results in August. We delivered 27% growth in total credit ADV year-over-year, driven by a 34% increase in U.S. high-grade, a 25% increase in emerging markets, a 19% increase in Eurobonds, and a 49% increase in municipal bonds. We also generated record portfolio trading ADV of $988 million. Our leadership position in the global credit institutional e-trading space remains strong, and we are beginning the roll-out of X-Pro to our global client base later this month.”

Select August 2024 highlights*

• Total average daily volume (“ADV”) of $41.6 billion, up 39.6% (+18.4% compared to July 2024). This strong performance was driven by a 27.4% (+3.6% compared to July 2024) increase in total credit ADV, and a 46.1% (+26.9% compared to July 2024) increase in total rates ADV.

U.S. Credit2

• U.S. high-grade ADV of $6.7 billion, up 33.7% (+10.0% compared to July 2024) on a 38.4% (+2.4% compared to July 2024) increase in estimated market ADV. Estimated market share was 19.9%, down from 20.6% in the prior year, but up from 18.6% in July 2024. Including the impact of single-dealer portfolio trades, estimated market share was 20.9% in August 2024, up from 20.7% in the prior year, and up from 18.7% in July 2024.
• U.S. high-yield ADV of $1.3 billion, up 7.2% (+14.0% compared to July 2024), with estimated market share of 14.4% (14.6% including the impact of single-dealer portfolio trades), down from 15.9% in the prior year, but up from 12.5% (13.1% including the impact of single-dealer portfolio trades) in July 2024. U.S. high-yield estimated market ADV increased 17.9% (down 0.8% compared to July 2024).

Other Credit

• Emerging markets ADV of $3.2 billion, up 25.5%, (+1.0% compared to July 2024) with strong regional contribution across the LATAM, EMEA and APAC regions. The year-over-year increase was driven by a 14.6% increase in hard currency ADV, and a 35.6% increase in local currency markets ADV.
• Eurobonds ADV of $1.5 billion, up 19.0% (down 18.8% compared to July 2024).
• Municipal bond ADV of $580 million, up 49.5%, (+0.9% compared to July 2024), with estimated market ADV down 3.0% (+1.3% compared to July 2024). Estimated market share of 8.6%, up from 5.6% in the prior year, and in line with 8.6% in July 2024.3

Strategic Priority Related Protocols & Workflow Tools

• Record $988 million in portfolio trading ADV, up 125.6% from August 2023, and up 1.6% from July 2024. Our estimated market share of U.S. high grade and U.S. high-yield TRACE portfolio trading was 21.8% in August 2024, up from 17.2% in July 2024. Portfolio trading represented 9.5% of U.S. high-grade and U.S. high-yield TRACE in August 2024, compared to 10.6% in July 2024.
• 36% Open Trading share4 of total credit trading volume, up from 34% in the prior year, and up from 35% in July 2024.
• Dealer RFQ ADV of $1.1 billion across all credit products increased 15.0% from the prior year, and increased 2.6% from July 2024.
• AxessIQ, the order and execution workflow solution designed for wealth management and private banking clients, achieved ADV of $112 million, up 32.8% from the prior year, but down 3.6% from July 2024.

Rates

• Total rates ADV of $28.4 billion, up 46.1% versus the prior year, and up 26.9% compared to July 2024.3

Variable Transaction Fees Per Million (FPM)

• The preliminary FPM1 for total credit for August 2024 was approximately $154, in line with $154 in the prior year, but up from $143 in July 2024. The increase compared to July 2024 was due to the higher duration of bonds traded in U.S. high-grade, principally driven by an increase in the weighted average years to maturity, and the impact of product and protocol mix. The preliminary FPM for total rates was approximately $4.00, compared to $4.35 in the prior year.

*All comparisons versus August 2023 unless otherwise noted.

Table 1: August 2024 ADV

 

 

 

CREDIT

RATES

$ in millions

(unaudited)

US/UK

Trading Days5

Total

ADV

Total

Credit

High-Grade

High-Yield

Emerging

Markets

Eurobonds

Municipal

Bonds

Total

Rates

US Govt.

Bonds

Agcy./Other

Govt. Bonds

Aug-24

22/21

$41,610

$13,253

$6,702

$1,286

$3,187

$1,488

$580

$28,357

$27,305

$1,052

Jul-24

22/23

$35,135

$12,791

$6,090

$1,128

$3,157

$1,832

$575

$22,344

$21,332

$1,012

Aug-23

23/22

$29,805

$10,399

$5,011

$1,200

$2,540

$1,250

$388

$19,406

$19,072

$334

YoY % Change

 

40%

27%

34%

7%

25%

19%

49%

46%

43%

215%

MoM % Change

 

18%

4%

10%

14%

1%

(19%)

1%

27%

28%

4%

Table 1A: August 2024 estimated market share

CREDIT

RATES

(unaudited) High-Grade High-Yield

High-Grade/High-Yield

Combined

Municipals3

US Govt.

Bonds3

Aug-24

19.9%

14.4%

18.8%

8.6%

2.7%

Jul-24

18.6%

12.5%

17.3%

8.6%

2.5%

Aug-23

20.6%

15.9%

19.5%

5.6%

2.7%

YoY Bps Change

(70) bps

(150) bps

(70) bps

+300 bps

- bps

MoM Bps Change

+130 bps

+190 bps

+150 bps

- bps

+20 bps

  1 The FPM for total credit and total rates for August 2024 are preliminary and may be revised in subsequent updates and public filings. The Company undertakes no obligation to update any fee information in future press releases.

2 The Company is highlighting the impact of single-dealer portfolio trading volume on U.S. high-grade and U.S. high-yield trading volume and estimated market share but will continue to exclude single-dealer portfolio trading activity from each product’s aggregated trading volume and estimated market share and the total credit FPM calculation.

3 See “General Notes Regarding the Data Presented” below.

4 Open Trading share of total credit trading volume is derived by taking total Open Trading volume across all credit products where Open Trading is offered and dividing by total credit trading volume across all credit products where Open Trading is offered.

5 The number of U.S. trading days is based on the SIFMA holiday recommendation calendar and the number of U.K. trading days is based primarily on the U.K. Bank holiday schedule.

General Notes Regarding the Data Presented

Reported MarketAxess volume in all product categories includes only fully electronic trading volume. MarketAxess trading volumes and the Financial Industry Regulatory Authority (“FINRA”) Trade Reporting and Compliance Engine (“TRACE”) reported volumes are available on the Company’s website at investor.marketaxess.com/volume.

In addition, for periods beginning with January 2024, the Company has made changes to the market volume data used to calculate estimated market share for Municipal and U.S. Government Bonds. For Municipal Bonds, the Company previously used estimates, derived from data issued by the Municipal Securities Rule Making Board (“MSRB”), including estimates for new issuance, commercial paper and variable-rate trading activity, and excluded these volumes from the estimated market volume data. While the Company still uses estimates, the new methodology for identifying and excluding these volumes from the market volume data is now based on MSRB “flags” to identify new issuance, commercial paper, and variable-rate volumes. For U.S. Government Bonds, the previous data source for estimated market volumes was the Federal Reserve Bank’s Reported Primary Dealer U.S. Treasury Bond Trading Volumes, which was reported on a one-week lag. The new source for U.S. Government Bond trading volumes is FINRA’s U.S. Treasury TRACE data. The Company believes that the refined methodology used for Municipal Bonds, and the new data source for U.S. Government Bonds, provides more accurate measures of estimated market volumes and estimated market share. Prior comparable periods have been recast retrospectively for both Municipal and U.S. Government Bonds to conform to the updated presentation of the data. The new estimated market volume data is also available on the Company’s website at investor.marketaxess.com/volume.

Cautionary Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements, including statements about the outlook and prospects for the Company, market conditions and industry growth, as well as statements about the Company’s future financial and operating performance. These and other statements that relate to future results and events are based on MarketAxess’ current expectations. The Company’s actual results in future periods may differ materially from those currently expected or desired because of a number of risks and uncertainties, including: global economic, political and market factors; the level of trading volume transacted on the MarketAxess platform; the rapidly evolving nature of the electronic financial services industry; the level and intensity of competition in the fixed-income electronic trading industry and the pricing pressures that may result; the variability of our growth rate; our ability to introduce new fee plans and our clients’ response; our ability to attract clients or adapt our technology and marketing strategy to new markets; risks related to our growing international operations; our dependence on our broker-dealer clients; the loss of any of our significant institutional investor clients; our exposure to risks resulting from non-performance by counterparties to transactions executed between our clients in which we act as an intermediary in matched principal trades; risks related to self-clearing; risks related to sanctions levied against states or individuals that could expose us to operational or regulatory risks; the effect of rapid market or technological changes on us and the users of our technology; our dependence on third-party suppliers for key products and services; our ability to successfully maintain the integrity of our trading platform and our response to system failures, capacity constraints and business interruptions; the occurrence of design defects, errors, failures or delays with our platforms, products or services; our vulnerability to malicious cyber-attacks and attempted cybersecurity breaches; our actual or perceived failure to comply with privacy and data protection laws; our ability to protect our intellectual property rights or technology and defend against intellectual property infringement or other claims; our ability to enter into strategic alliances and to acquire other businesses and successfully integrate them with our business; our dependence on our management team and our ability to attract and retain talent; limitations on our flexibility because we operate in a highly regulated industry; the increasing government regulation of us and our clients; risks related to the divergence of U.K. and European Union legal and regulatory requirements following the U.K.’s exit from the European Union; our exposure to costs and penalties related to our extensive regulation; our risks of litigation and securities laws liability; adverse effects as a result of climate change or other ESG risks that could affect our reputation; our future capital needs and our ability to obtain capital when needed; limitations on our operating flexibility contained in our credit agreement; our exposure to financial institutions by holding cash in excess of federally insured limits; and other factors. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. More information about these and other factors affecting MarketAxess’ business and prospects is contained in MarketAxess’ periodic filings with the Securities and Exchange Commission and can be accessed at www.marketaxess.com.

About MarketAxess

MarketAxess (Nasdaq: MKTX) operates a leading electronic trading platform that delivers greater trading efficiency, a diversified pool of liquidity and significant cost savings to institutional investors and broker-dealers across the global fixed-income markets. Over 2,000 firms leverage MarketAxess’ patented technology to efficiently trade fixed-income securities. Our automated and algorithmic trading solutions, combined with our integrated and actionable data offerings, help our clients make faster, better-informed decisions on when and how to trade on our platform. MarketAxess’ award-winning Open Trading® marketplace is widely regarded as the preferred all-to-all trading solution in the global credit markets. Founded in 2000, MarketAxess connects a robust network of market participants through an advanced full trading lifecycle solution that includes automated trading solutions, intelligent data and index products and a range of post-trade services. Learn more at www.marketaxess.com and on X @MarketAxess.

Table 2: Trading Volume Detail Month Ended August 31, In millions (unaudited)

2024

2023

% Change Volume ADV Volume ADV Volume ADV Credit High-grade

$

147,449

$

6,702

$

115,260

$

5,011

27.9

%

33.7

%

High-yield

 

28,284

 

1,286

 

27,594

 

1,200

2.5

7.2

Emerging markets

 

70,115

 

3,187

 

58,421

 

2,540

20.0

25.5

Eurobonds

 

31,240

 

1,488

 

27,498

 

1,250

13.6

19.0

Other credit

 

12,970

 

590

 

9,163

 

398

41.5

48.2

Total credit trading1

 

290,058

 

13,253

 

237,936

 

10,399

21.9

27.4

Rates U.S. government bonds2

 

600,715

 

27,305

 

438,656

 

19,072

36.9

43.2

Agency and other government bonds1

 

22,233

 

1,052

 

7,489

 

334

196.9

215.0

Total rates trading

 

622,948

 

28,357

 

446,145

 

19,406

39.6

46.1

Total trading

$

913,006

$

41,610

$

684,081

$

29,805

33.5

39.6

Number of U.S. Trading Days3

 

22

 

23

Number of U.K. Trading Days4

 

21

 

22

  Year-to-Date Ended August 31, In millions (unaudited)

2024

2023

% Change Volume ADV Volume ADV Volume ADV Credit High-grade

$

1,142,868

$

6,803

$

964,490

$

5,775

18.5

%

17.8

%

High-yield

 

222,717

 

1,326

 

269,258

 

1,612

(17.3)

(17.7)

Emerging markets

 

571,199

 

3,400

 

477,451

 

2,859

19.6

18.9

Eurobonds

 

330,492

 

1,967

 

295,018

 

1,767

12.0

11.3

Other credit

 

85,522

 

509

 

69,718

 

417

22.7

22.1

Total credit trading1

 

2,352,798

 

14,005

 

2,075,935

 

12,430

13.3

12.7

Rates U.S. government bonds2

 

3,352,733

 

19,957

 

3,200,682

 

19,166

4.8

4.1

Agency and other government bonds1

 

125,518

 

748

 

69,361

 

415

81.0

80.2

Total rates trading

 

3,478,251

 

20,705

 

3,270,043

 

19,581

6.4

5.7

Total trading

$

5,831,049

$

34,710

$

5,345,978

$

32,011

9.1

8.4

Number of U.S. Trading Days3

 

168

 

167

Number of U.K. Trading Days4

 

168

 

167

  1 Consistent with FINRA TRACE reporting standards, both sides of trades are included in the Company's reported volumes when the Company executes trades on a matched principal basis between two counterparties. 2 Consistent with industry standards, U.S. government bond trades are single-counted. 3 The number of U.S. trading days is based on the SIFMA holiday recommendation calendar. 4 The number of U.K. trading days is based primarily on the U.K. Bank holiday schedule.

 

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INVESTOR RELATIONS Stephen Davidson MarketAxess Holdings Inc. +1 212 813 6313 sdavidson2@marketaxess.com

MEDIA RELATIONS Marisha Mistry MarketAxess Holdings Inc. +1 917 267 1232 mmistry@marketaxess.com