JPMorgan will use a computerized trading firm’s technology to access and trade in the U.S. Treasury market, marking a further step in the transformation of markets by electronic specialists.
Bloomberg News reports that the bank is partnering with Virtu Financial, one of the biggest electronic trading companies, according to a statement on Wednesday. The agreement, which lasts at least three years, allows JPMorgan to use Virtu’s technology in the dealer-to-dealer market.
“We’ve really opened up the kimono to show them how we operate,” Virtu Chief Executive Officer Douglas Cifu said on an earnings call with analysts. “There’s buy-in on both sides to try and make this work and expand beyond U.S. Treasuries.”
Electronic trading firms with cutting-edge technology now play a vital role in markets, and they’ve also encroached on banks’ turf. Another company, XTX Markets, recently jumped into the top ranks of currency traders, traditionally an exclusive club for Wall Street dealers.
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