NEW YORK, NY, December 10, 2015 – DelphX is restoring dealers’ ability to provide on-demand market liquidity by enabling them to access inventories held by institutional investors. The patent-pending Cached Inventory™ technology will reduce dealers’ capital requirements by eliminating their need to hold extensive fixed income inventory, while asset managers will benefit from preferential pricing and improved allocations in both the primary and secondary markets.
Within the confidential network operated by DelphX, dealers negotiate the terms of a future transaction with an investor, which allows the dealer to buy or sell a specified amount of the security at an agreed price within a set time period.
“Corporate bond liquidity is certainly an urgent topic given the balance sheet limitations on the sell-side,” said Kevin McPartland, Head of Market Structure at Greenwich Associates. “Any tool that mitigates this while addressing the need of the buy-side to generate performance alpha is likely to attract attention.”
DelphX is scheduled to launch the new platform in Q1 2016, following the close of its current Series A funding round.
Cached Inventory has already captured the attention of many leading dealers and institutional investors. By providing the tools to connect dealers with buy-side balance sheets, DelphX strengthens the current market structure and enhances the traditional roles of its participants – a shift away from other initiatives aimed at solving bond market liquidity concerns by disintermediating the sell-side.
“Cached Inventory is an elegant solution to the challenges facing OTC market participants,” said Larry Fondren, CEO of DelphX, a pioneer in fixed income market services. “Not only does it enable dealers to maintain their principal role for clients, but it enhances the returns of investment firms in this historically low rate environment.”
Cached Inventory is one of several innovative services and features that DelphX is delivering to the marketplace, including customized dealer quotes, continuously-updating reference pricing, investor-initiated auctions and elimination of transaction fees for all participants.
DelphX is a leader in the development of optimal OTC markets. It is an unbiased service provider dedicated to promoting liquidity in the credit markets through digital dealerinvestor communication, effective liquidity incentives and market-wide transparency. DelphX is not owned or controlled by any entity with a vested interest in the success of particular issuers, securities or market participants. It is an independent, privately owned firm that does not directly or indirectly compete with any participating dealer or investor.