Virtu Financial and MarketAxess Holdings, each a global leader in electronic trading and analytics, today announced leading exchange-traded fund (ETF) issuers Charles Schwab Investment Management and WisdomTree Asset Management as new clients of Virtu’s eNAV ETF analytics tool enhanced with MarketAxess’ award-winning Composite+, an AI-powered algorithmic pricing engine for corporate and emerging market bonds.
Rolled-out in 1Q 2020, Virtu’s eNAV ETF analytics tool offers real-time transparency for ETF valuations by calculating the bid and ask prices of ETFs based on their underlying components and/or proxy assets. As a complement, Composite+ combines both public (US TRACE) and proprietary MarketAxess data to produce an unbiased, two-sided market for more than 28,000 instruments globally. Updated every 15 to 60 seconds (depending on the liquidity of the instrument), the Composite+ engine generates nearly 30 million levels per day covering 90-95% of trading activity in its markets.
“We are excited that major ETF issuers understand and value the many benefits eNAV delivers,” said Douglas Cifu, Co-Founder and CEO of Virtu Financial. “By joining forces with MarketAxess we are empowering issuers to better understand market value and reliably monitor their ETFs in support of high quality and efficient execution by their investors. As long-time advocates for transparency, we believe eNAV will provide even greater clarity in ETF secondary market pricing and become the industry standard.”
Virtu’s eNAV supports a variety of trading functions including pre-trade price discovery and execution consultation, liquidity provision, post-trade transaction cost analysis, auto-execution and crossing. Coverage includes US-listed ETFs with domestic and international equities, commodity and fixed income holdings and can facilitate many use cases such as:
- Monitoring and analyzing real-time bid-ask prices (updated as underlying components do) as well as real-time fair value pricing for ETF components trading outside of US time zones
- Quote size analysis of both ETF secondary market liquidity and underlying component liquidity that demonstrates in much greater detail depth of market for each ETF
- Profiling liquidity and comparing ETFs with same investment objectives
“We are excited to leverage our award-winning data product, Composite+ as part of our partnership with Virtu to bring real-time pricing accuracy and transparency to the fixed income ETF marketplace” said Chris Concannon, President and COO of MarketAxess. “As institutional investors increasingly adopt ETFs as portfolio tools, real-time portfolio pricing will be essential for execution efficiency.”
The eNAV ETF streaming product featuring MarketAxess Composite+ is accessible via Virtu’s online client Portal which includes access to a streaming API.