Creditex unveils new trading technology
Creditflux - Issue no 5, 21 December 2001

Online trading platform Creditex has announced plans to introduce a new chat-based facility for trading credit derivatives, allowing members to transact in real time. This marks an advance on the current web-based system, in which prices are only updated when users refresh their browser. “When we launched Creditex, credit derivatives were less about speed than about getting the documentation right,” says Creditex co-founder John McEvoy. “In that market, a website was as fast as we needed the technology to be. But now that documentation has become more streamlined and the market has become more efficient, we need to adapt to the market by introducing faster technology.”

Some other electronic trading platforms have countered the lack of real-time interactivity on the web by posting prices on Bloomberg and using that system’s messaging. But Creditex has avoided this route. “Our new trading platform give dealers a real-time tool that is just as effective as Bloomberg,” says McEvoy.

The new technology is currently being tested and will be rolled out in both New York and London over the next few months.

Rapid growth

Creditex has also announced figures showing rapid growth this year. It claims a 462% increase in notional traded between January and November 2001.

McEvoy declines to specify the volume of deals but says that Creditex is completing hundreds of transactions in the single-name business every month as well as doing increasing volumes of structured trades. Other market participants agree that Creditex has succeeded in raising its profile this year. But they say that the growth has come entirely from a beefed-up voice brokerage capability rather than online trading. McEvoy rejects this. “voice brokerage is part of our strategy but it is not the end game,” he says. “Technology remains a key differentiator for us. Very often, people pull up our prices on the screen and then get on the phone and trade that way. And that is fine by us. It means we are getting leverage from our technology.”

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