US-based electronic marketplace TradeWeb has gone live with a service for trading TBA mortgage pass-through securities. Liquidity is supplied by member firms Credit Suisse First Boston, Deutsche Bank, Goldman Sachs, Lehman Brothers, Merrill Lynch, Morgan Stanley, and Salomon Smith Barney.
The launch follows a two-month beta test during which approximately 40 institutional investors and dealers traded 30-year and 15-year fixed-rate TBA-MBS. Trading volume during this period exceeded $45 billion with an average trade size of more than $25 million, the company reports. Highlights of the beta test include a dollar-roll trade of more than $900 million and a single outright trade of $250 million.
Scott Miller, MBS trader from State Street Global Advisors and a beta user comments: "We are impressed by the TradeWeb platform. To be able to get good indicative levels and then get clean efficient trade execution from the dealers will serve to add liquidity to the market. The efficiency and accuracy of TradeWeb may allow accounts to trade more aggressively."
In addition to TBA-MBS, the TradeWeb multi-dealer auction technology is utilised for the trading of US Treasury and Agency securities, Euro Sovereigns and commercial paper (currently in beta testing).