Bloomberg Introduces Spread-to-Benchmark Quoting for EUR and GBP Portfolio Trading Baskets

Bloomberg announced the launch of Spread-to-Benchmark quoting and trading for Euro (EUR) and Sterling (GBP) denominated portfolio trades through its Portfolio Trading Basket Builder (PTBB). The new functionality expands the range of quoting protocols available for European credit portfolio trading and reflects growing client demand for spread-based execution workflows, alongside increased dealer support for the convention across EUR and GBP markets.

Spread-to-Benchmark quoting is a well-established protocol for USD credit portfolio trades and is used by market participants to evaluate and execute portfolio trades. By extending this workflow to EUR and GBP portfolio trades, Bloomberg enables clients and dealers to transact using a familiar spread-based methodology across additional credit markets.

The introduction of Spread-to-Benchmark quoting for EUR and GBP baskets reflects increased client interest in evaluating portfolio trades through a spread-based lens and the growing adoption of spread-based execution workflows in European credit markets. The workflow provides market participants with an additional framework for assessing the relationship between credit spread risk and underlying government bond yields when pricing and executing portfolio trades.

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Additional Workflow Flexibility 
The workflow complements Bloomberg’s existing portfolio trading capabilities, which support the full range of market-standard quoting conventions, including Price, Yield, Spread-to-Benchmark and Spread based workflows that reference Bloomberg’s evaluated pricing service (BVAL). This gives clients flexibility to compare and execute portfolio trades using the quoting methodology that best aligns with their investment objectives, execution preferences and internal risk management processes.

“European credit clients continue to look for execution workflows that reflect how they evaluate risk and monitor portfolio trading outcomes,” said Harry Street, Global Head of Credit and Equities Trading Product at Bloomberg. “By expanding dealer support for Spread-to-Benchmark quoting for EUR and GBP baskets, Bloomberg is broadening the range of workflow options available to clients trading European credit portfolios.”

“Portfolio trading workflows in fixed income continue to become more sophisticated as institutional investors look for ways to evaluate execution quality in changing market conditions,” said Kevin McPartland, Head of Market Structure & Technology Research at Crisil Coalition Greenwich. “Spread-based quoting helps market participants more clearly distinguish between the impacts of credit spread and underlying rates movements when determining how best to execute a portfolio trade.”

Bloomberg’s Electronic Markets solutions are used by leading financial institutions to trade efficiently in over 175 markets around the world. More than 9,000 client firms use Bloomberg Electronic Markets to access industry-leading depth and breadth of liquidity across asset classes from over 800 dealers globally. Bloomberg Electronic Markets provides market participants with comprehensive solutions across the trading lifecycle, including robust price transparency, analytics, automation and execution, powered by Bloomberg’s high-quality, multi-asset class data and tools.

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