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Survey of European asset managers finds that 71% of those who use independent market makers (IMMs) as direct liquidity partners started to do so in the last 3 years, coinciding with the rise in market stress. It is estimated that a third of the top asset managers in Europe currently engage directly with IMMs, suggesting significant room for growth.
Access to specialism was, overwhelmingly, cited as the main driver for diversifying trading counterparties. Those using IMMs reported lower execution costs and less issues accessing continuous liquidity during periods of intense volatility. As rising market stress leads some of the traditional liquidity providers to partially withdraw from certain segments of the market, the need for Europe-based asset managers to expand and...
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