Thomson TradeWeb LLC plans to announce today its expansion into retail electronic fixed-income trading through its acquisition of LeverTrade LLC.
LeverTrade provides a system whereby brokers and financial advisers search a commingled inventory from more than 30 broker-dealers and then generate orders that flow to their internal trading desks. The acquisition will allow Thomson TradeWeb — which in the past had only one system, used exclusively by dealers and institutional investors — to expand into the retail market.
The LeverTrade product, which was formerly known as Global Trade Technologies, will be renamed TradeWeb Retail and will function as a separate platform from Thomson TradeWeb’s previous product.
The product will be offered to retail brokerage firms and investment advisers as a low-cost retail bond trading system that includes price discovery tools and exception reporting. TradeWeb Retail will also offer to users odd lots of bonds from the Thomson TradeWeb institutional platform.
The acquisition — which closed this month — could put Thomson TradeWeb, which is a subsidiary of Thomson Financial, into direct competition with BondDesk Group LLC in the retail municipal bond market.
The new TradeWeb product will also be offered to buy-side investment managers with a special functionality allowing them to request quotes from specific dealers and then view the source of those quotes.
“Dealers communicated to us the demand for a low-cost, flexible, scalable retail fixed-income platform that had a robust liquidity pool and innovative functionality,” a TradeWeb spokeswoman said in a statement. “TradeWeb looked at Thomson Financial’s retail wealth management, reaching 130,000 desktops, and saw it was mostly an equities solution,” she added.
“We knew we could fill the fixed-income gap, and given the current regulatory environment and the first wave of baby boomers reaching 60, we saw a huge opportunity,” the spokeswoman said.
“Entering into retail fixed income is the logical next step for us,” Jim Toffey, chief executive officer of Thomson TradeWeb, said in another statement.
“Acquiring LeverTrade — a company with proven retail fixed-income trading technology — coupled with TradeWeb’s existing dealer relationships and Thomson Financial’s presence in the retail wealth market allows us to build out our strategy to be the one-stop destination for all electronic fixed-income trading,” Toffey added.
TradeWeb Retail will initially allow users to trade corporate bonds, agency securities, certificates of deposit, and Treasuries in addition to muni bonds. However, it plans to offer mortgage-backed securities and preferred stock shares later this year.
The new product will allow Thomson TradeWeb to leverage its operations and technology with other products owned by Thomson Financial. TradeWeb Retail will be integrated with Thomson Financial’s back-office system, BETA, as well as its retail wealth front-end desktop product, Thomson One, which is used by 130,000 brokers and financial advisers.
TradeWeb Retail will also connect to non-Thomson back-office systems and other third-party applications.
