MarketAxess Holdings Inc (MKTX, Financial), a leading electronic trading platform for fixed-income securities, announced its trading volume and preliminary variable transaction fees per million (FPM) for December 2024 and the fourth quarter ending December 31, 2024. The company reported record total trading average daily volume (ADV) driven by strong growth across various product areas, including a 16% year-over-year increase in international products and record ADV in municipal bonds and total rates. The press release was issued on January 5, 2025.
Positive Highlights
- Record total trading ADV for Q4 2024.
- 16% year-over-year growth in international products.
- Record ADV in municipal bonds and total rates.
- 18% increase in emerging markets ADV compared to the previous year.
- 77% of portfolio trades executed on X-Pro in December 2024.
Negative Highlights
- U.S. high-grade ADV decreased by 3% year-over-year.
- U.S. high-yield ADV decreased by 14% year-over-year.
- Decline in total trading ADV in December compared to November 2024 due to seasonal slowdown.
- Preliminary FPM for total credit decreased from $159 to $148 year-over-year.
Financial Analyst Perspective
MarketAxess Holdings Inc (MKTX, Financial) has demonstrated robust growth in its trading volumes, particularly in international and emerging markets. The record ADV in municipal bonds and total rates indicates a strong demand for these products. However, the decline in U.S. high-grade and high-yield ADV suggests potential challenges in these segments. The decrease in FPM for total credit highlights a shift in product mix, which could impact revenue generation. Overall, the company's strategic focus on portfolio and block trading appears to be yielding positive results, but attention to U.S. credit markets is necessary.
Market Research Analyst Perspective
The significant growth in MarketAxess's trading volumes, especially in international and emerging markets, reflects a broader trend of increasing global demand for electronic trading platforms. The company's ability to capture a larger share of the municipal bond market is noteworthy, as it suggests a shift in investor preferences towards more diversified fixed-income products. The seasonal slowdown in December is typical, but the overall year-over-year growth indicates a strong market position. MarketAxess's continued investment in technology, such as the X-Pro platform, is likely to enhance its competitive edge in the electronic trading space.
Frequently Asked Questions
Q: What was the total ADV for MarketAxess in Q4 2024?
A: The total ADV for Q4 2024 was $41.0 billion, a 38% increase compared to the prior year.
Q: How did the U.S. high-grade and high-yield markets perform?
A: U.S. high-grade ADV decreased by 3% year-over-year, while U.S. high-yield ADV decreased by 14% year-over-year.
Q: What was the impact of the seasonal slowdown in December?
A: The total trading ADV in December decreased by 29% compared to November 2024 due to the normal seasonal slowdown.
Q: How did the emerging markets perform?
A: Emerging markets ADV increased by 18% compared to the prior year, driven by a 14% increase in hard currency ADV.
Q: What is the preliminary FPM for total credit in December 2024?
A: The preliminary FPM for total credit in December 2024 was approximately $148, down from $159 in the prior year.
Read the original press release here.
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