Heavy investments by global banks in fixed-income trading platforms over the past several years have resulted in intense competition in the U.S. market, according to the results of Greenwich Associates 2011 U.S. Fixed-Income Study.
In 2011, no fewer than three dealers — Barclays Capital, Deutsche Bank and J.P. Morgan — are deadlocked at the top of the market with market shares in institutional trading of roughly 11.5%. Two firms, Goldman Sachs and Citi, follow close behind with market shares topping 10%. These firms are the 2011 Greenwich Leaders in Overall U.S. Fixed-Income Market Share.
"Compared with recent years, the results are clear: Competition is flattening out the market and institutions are spreading their business more broadly," says Greenwich Associates consultant Tim Sangston. "These firms and a group of other strong competitors have built market share by enticing institutions with aggressive pricing and intense, high quality coverage and service."
Greenwich Share Leaders: Credit, Rates, Securitized Products, and Emerging Markets
The 2011 Greenwich Share Leaders in U.S. Fixed Income, Credit Products, are J.P. Morgan, which tops the market with a market share of 15.2%, followed by Bank of America Merrill Lynch, Deutsche Bank, Morgan Stanley, Barclays Capital, and Goldman Sachs.
Roughly 80% of U.S. fixed-income trading volume is in Rates Products, which includes MBS pass-throughs. The 2011 Greenwich Share Leaders in U.S. Fixed Income, Rates Products, are Deutsche Bank, Barclays Capital, J.P. Morgan, Goldman Sachs, and Citi.
In Securitized Products, the 2011 Greenwich Share Leaders are Barclays Capital, Bank of America Merrill Lynch and Credit Suisse.
In Emerging Markets Products, the 2011 Greenwich Share Leaders are Deutsche Bank, Barclays Capital, J.P. Morgan, HSBC, and Citi.
The 2011 Greenwich Share Leaders in Municipal Bonds are Citi, Bank of America Merrill Lynch, J.P. Morgan, and Morgan Stanley.