The DelphX Mission
An innovation leader, DelphX is introducing unique utilities for the fixed income and derivatives markets that deliver the following outcomes for market participants:
- Expanded liquidity -The DelphX ATS, a confidential OTC negotiation and communication network that streamlines trading interaction between market makers and takers
- Increased Alpha - DelphX ATS subscribers can negotiate temporary caches of inventory supply and capacity provided by subscribers for maker deployment in pairing trades. In return, makers provide pricing concessions and other incentives to subscribers that generate alpha for the capacity providers.
- Improved transparency and pricing confidence - MAV≡n, a continuously updating pre-trade benchmark pricing utility providing transparent pricing information.
- A reinvented Derivative market - Quant≡m, a AAA-rated Derivative Product Company wholly owned by DelphX, which issues Default Compensation Receipts (DCRs) and Collateralized Reference Obligation (CRO) securities, new forms of securities developed to streamline origination and conveyance of credit default protection for virtually any corporate, municipal, sovereign, MBS or other reference entity or issue, and to generate considerable alpha by assuming, managing and speculatively investing in default and other credit risk.
The Alarming New Normal
Conditions in the fixed income market have deteriorated since 2007. Primary dealer inventories of U.S. corporate bonds have dropped significantly, even as the volume of outstanding issues has continued to increase to record levels. That’s having a significant impact on liquidity.
At the heart of the problem, regulation and capital constraints have materially reduced the ability of dealers to hold inventory, draining their capacity to provide capital-based liquidity, or have made it prohibitively expensive for dealers to provide what had been traditional solutions for credit trading. This problem is compounded by the logistical limitations of traditional voice-based trading.
For investors, these limitations, coupled with the lack of a market-wide price-discovery resource, make it nearly impossible to definitively demonstrate best execution for fixed income transactions. And, they hamper the ability of dealers to efficiently intermediate liquidity by pairing customer transactions with other OTC trades.
In short, buy-side and sell-side firms need a credit market facility that:
- Provides a more efficient and less costly way of interacting.
- Seamlessly automates their current trading processes.
- Maintains, enhances and expands their market relationships.
- Restores and promotes sustainable, on-demand liquidity.
The DelphX Difference
Guided by extensive input gathered from buy-side and sell-side market participants, DelphX has designed the first confidential network for direct negotiation of corporate bonds and other fixed income securities transactions in the OTC market. Through its confidential query, quote, RFQ, instant messaging and other recipient-specific communication features and options:
- Investors gain access to market-wide price transparency and competing counterparty quotes, intuitive trading tools, definitive best execution analytics and lower transaction costs.
- Dealers and other market makers gain access to the liquidity incentives and inventory resources they require to provide deep, on-demand liquidity.
DelphX delivers these features through two symbiotic utilities: the DelphX ATS, a digital OTC negotiation and communication network, and MAV≡n, a dynamic source of continuously updating benchmark pricing for liquid and illiquid fixed income securities integrated within the DelphX ATS.
- Simultaneous one-to-one, one-to-selected and one-to-all recipient-specific communication of confidential queries, quotations, RFQs and instant digital messages among market makers and takers.
- Definitive investor-specific best execution compliance services and documentation.
- Caching of deployable inventory supply and capacity held by investors for use by market makers in intermediating resilient OTC liquidity.
- No transaction fees to market/price makers
Learn More about the DelphX ATS
MAV≡n Benchmark Pricing
- Proprietary pricing utility that continuously forecasts the price at which each tracked security would currently trade, and records the historical accuracy of all prior forecasts at the time of each trade.
- Benchmark valuations and indexes uniquely informed by all dealer quotes pending in the centralized private books of all DelphX subscribers, with further timely updated accuracy provided from the data derived from the issuance and secondary trading of DCRs.
Learn More about MAV≡n Benchmark Pricing