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Tradeweb announced that total trading volume for December 2021 was $20.0 trillion (tn) across its electronic marketplaces for rates, credit, equities and money markets. Average daily volume (ADV) for the month was $915.9 billion (bn), an increase of 9.8 percent (%) year-over-year (YoY), with preliminary average variable fees per million dollars of volume traded of $2.55 for the fourth quarter of 2021.[1]
For the fourth quarter of 2021, Tradeweb reported total trading volume of $69.7tn and record ADV of $1.11tn, up 24.1% YoY, with quarterly ADV records in U.S. government bonds, U.S. High Yield credit, and swaps/swaptions ≥ 1-year.
The fourth quarter of 2021 capped off a record volume year for Tradeweb, with ADV for the full year exceeding $1tn and most product groups seeing record activity, including: U.S. and European government bonds; swaps/swaptions ≥ 1-year; U.S. High Grade and High Yield credit; European credit; Chinese bonds; U.S. and European ETFs; equity convertibles/swaps/options; and Repurchase Agreements. Further, with over $300bn in electronic portfolio trading volume in 2021, activity more than doubled from the prior year. For more on our quarterly and annual performance, see the table below.
Lee Olesky, Tradeweb CEO, said: “Tradeweb facilitated record trading volume in 2021, exceeding $1 trillion in average daily volume and culminating with a record fourth quarter. This was a breakthrough year for us in credit, fuelled by Tradeweb’s leadership in electronic portfolio trading and other innovations such as AiEX and sweep. In rates, we became the leading electronic trading platform for U.S. Treasuries, while interest rate volatility around the world contributed to higher volumes in government bonds and swaps globally. Looking across asset classes, trends in passive investing drove strong interest in our ETF and credit platforms, while increased automation played a powerful role in all of our markets. Most importantly, we believe 2021 represented a clear inflection point in the long-term trends towards more electronic trading.”
December Volume Highlights
Rates
- U.S. government bond ADV was up 23.6% YoY to $113.7 billion (bn)[2], and European government bond ADV was up 7.4% YoY to $21.9bn.
- Trading in U.S. government bonds was supported by strong client activity in institutional and wholesale markets; the continued momentum of session-based trading and streaming protocols; and the addition of the Nasdaq Fixed Income business. Steady global government bond issuance, along with sustained rates market volatility, was supportive of trading overall.
- Mortgage ADV was down 18.1% YoY to $150.1bn.
- Declining issuance and tight mortgage spreads weighed on overall market activity.
- Swaps/swaptions ≥ 1-year ADV was up 11.8% YoY to $165.4bn, and total rates derivatives ADV was up 35.9% YoY to $266.0bn.
- Swaps/swaptions ≥ 1-year volumes were driven by robust client interest in the request-for-market (RFM) protocol, continued engagement from international clients and increased client adoption of emerging markets swaps. Increased market focus on central bank policy continued to buoy trading in swaps/swaptions < 1-year.
Credit
- U.S. Credit ADV was up 4.4% YoY to $4.5bn and European credit ADV was down 9.3% YoY to $1.1bn.
- Continued growth in U.S. credit was driven by further client adoption of the request-for-quote (RFQ) protocol and session-based trading, as well as Tradeweb’s continued leadership in electronic portfolio trading. Reduced European client activity in late December weighed on volumes in credit and other asset classes across the platform. U.S. High Grade TRACE market share was 21.4%, of which 13.0% was transacted fully electronically, and U.S. High Yield TRACE market share was 10.4%, of which 7.4% was transacted fully electronically.
- Credit derivatives ADV was up 64.0% YoY to $8.5bn.
- Credit market volatility earlier in the month boosted volumes.
Equities
- U.S. ETF ADV was up 73.7% YoY to $7.9bn and European ETF ADV was up 27.6% YoY to $2.6bn.
- Continued growth in institutional client activity contributed to higher volumes. Elevated market activity boosted volumes in both the U.S. and Europe.
Money Markets
- Repurchase Agreement ADV was up 3.1% YoY to $314.0bn.
- The addition of new clients on the platform continued to support growth in Global Repo activity, even as record usage of the Fed’s reverse repo facility weighed on the overall repo market. Retail money markets activity remained pressured by the low interest rate environment.
[1] See pg.7 of the pdf for the detailed breakdown of each underlying asset class.
[2] U.S. government bond volumes include wholesale U.S. Treasury volumes from the Nasdaq Fixed Income business Tradeweb acquired on June 25, 2021.
You can find the complete report here: https://www.tradeweb.com/newsroom/monthly-activity-reports/.
