- Flickr/David Laundra
Electronifie, a corporate bond trading platform, has added Troy Paredes, a former commissioner at the SEC, to its board of directors. Also signed to the board is Max Kamhi, an entrepreneur and the former chief financial officer of hedge fund Jamison Capital Partners.
The trading platform is, along with TruMid and Liquidnet, a new entrant to the electronic bond trading world.
Business Insider reported last month that George Soros is backing TruMid, while Liquidnet took to a Monday night NFL game to run an ad to promote its fixed income dark pool. All three compete with incumbent electronic bond trading specialists MarketAxess and Tradeweb.
The firms are trying totake advantage of increased interest in electronic bond trading at a time when many are complaining about reduced liquidity. Amar Kuchinad, Electronifie’s chief executive – and a former trader at Goldman Sachs and Credit Suisse – said the market is big enough for all three startups. “It is not a contest between the three of us, it is a voice-trading versus electronic trading contest.”
“Now that all three of us are up and running and there is no clear winner, people are saying that maybe they have to onboard all three,” he added.
Electronifie is adding two or three subscribers each week, and within the next four weeks will have signed up three of the top five traditional asset managers in the business, he said. The platform is averaging 40 to 50 institutional sized orders at any given time, he said.
The credit markets have been showing signs of contagion of late, as Chinese growth concerns and slumping commodity prices lead to widespread selling. Kuchinad said volatility has both positive and negative effects for startup bond trading platforms.
“In the short term, when traders get distracted, it doesn’t help new platforms. But it was also a great example of dealers pulling back, and there not being as much liquidity as traders need.”