Tradeweb completes first electronic swaption package trade

Tradeweb Markets Inc. (NASDAQ: TW) completed the first fully electronic request-for-market swaption package trade, with Citadel and Barclays as counterparties on the Tradeweb Swap Execution Facility.

The trade enables institutional clients on TW SEF to request and receive a two-way market for a series of swaptions and swaps in a single electronic quote, rather than receiving a price based on one direction. The execution allows participants to share trading information exclusively between counterparties while maintaining transparency.

A swaption gives participants the option to enter into an interest rate swap in the future at a pre-determined rate. The request-for-market protocol allows clients to maintain control of trading intent while accessing transparency, customization and flexibility.

Troy Dixon, managing director and co-head of global markets at Tradeweb, said the trade "signals the expansion of Tradeweb's electronic trading capabilities into a previously untapped area of the rates market."

Sabri El Jailani, global head of rates options trading at Barclays, said the trade "reflects the growing momentum behind electronification in the global swaption market."

John Niccolai, chief operating officer for global fixed income at Citadel, said electronically trading swaptions "will increase transparency, improve execution workflow, reduce counterparty risk and strengthen liquidity."

Tradeweb introduced the RFM protocol to the interest rate swap market and has facilitated various electronic derivatives trades. Following the completion of this trade, 20 dealers now provide RFM swaption package pricing on TW SEF.

The information is based on a company press release statement.

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