Waters Rankings 2022 Winners' Circle: Bloomberg

Bloomberg is the big winner in this year’s Waters Rankings, walking away with four category wins: best sell-side order management system (OMS) provider, best market data provider, best reference data provider, and best managed data service provider. WatersTechnology chats to Phil McCabe, global head of sell-side solutions at Bloomberg, about the firm’s sell-side OMS―TOMS, or Trade Order Management System―and the reasons for its consistent success in the Rankings over the years.    

WatersTechnology: Bloomberg TOMS has won this category for the past seven straight years. What is it about the platform that allows Bloomberg to maintain its phenomenal consistency in the best sell-side OMS category?
Phil McCabe, global head of sell-side solutions, Bloomberg: Two things come to mind. The first is customer service. We constantly focus on evolving the product and its features, but we also focus on our customer service model. I’m being interviewed here because our customers voted for us, which is a great source of pride for us. 

TOMS is supported by a large team, but at Bloomberg everybody talks to our customers. We listen to and record what customers ask for—everything is written down, everything is considered. Our people are highly motivated, well-trained and they want to be the best at what they do. 

The second reason is the broader ecosystem. When you invest in TOMS, you don’t just get some software—you get the Bloomberg ecosystem. TOMS is like a screen through which everything else bubbles up—data, analytics, venues—and we innovate on all of that stuff, constantly. 

This year we’ve invested in ESG. It’s easy for TOMS users to identify ESG positions—there’s an ESG icon on the trading screen. We launched Bloomberg Bridge, our all-to-all trading service, which facilitates intermediated trading for corporates and emerging markets. We invested in natural language processing (NLP), and we developed a blotter so that TOMS users and traders never miss a trade indication. Our NLP tools recognize indications of trades, which they then surface in a blotter so users can see what’s being talked about and never miss a trading opportunity. 

WatersTechnology: What are Bloomberg’s sell-side clients’ particular pain points right now?
McCabe: It’s been a pretty nasty year for bonds, and rates have been all over the place. The credit market has seen its biggest dollar decline in 20 years and so liquidity is tough. If you look at the sell side or price makers, it’s all about providing liquidity for their clients. But equally, they want to do that with minimal risk. 

People are increasingly looking for tools that allow them to deliver excellent customer service, but also that allow them to automate. Our client information systems and our TOMS DASH product do precisely that. Imagine taking all of the information across your enterprise—all your Instant Bloomberg messages, all your electronic trades, and notes that your salespeople write and drop into client management systems or Bloomberg tools. All of that information is bubbled up and served back in real time, and we write applications on top of that.

Applications can be crossing engines, targeted axes or the ability to price trades with that extra bit of knowledge that tells you that you know the market’s behavior. For example, you might get a situation where you receive a request for a trade and you’ll see a pop-up that aggregates all of that data. For the sell side, often the reach of the desk and the enterprise with respect to client relationships is a game-changer. But you need tools to bring all of that information to the fore. 

WatersTechnology: Looking forward, the TOMS development roadmap includes the introduction of a variety of tools to support the FX, mortgage, repo and municipal bond markets. What is the timeframe for introduction of these tools and what other developments are in the pipeline? 
McCabe: FX has grown considerably. We’ve always allowed customers to deal with FX and we’ve added quite a few new features recently—a much better set of cash-flow analyses and P&L, which are integrated with Bloomberg’s Multi-Asset Risk System (MARS), which means we can now support the simplest forwards to the most complex exotics. That’s available right now. With respect to mortgages, we have the Bloomberg agency model, which is a sophisticated pay-down model. Using data and the BQuant tool, we’ve built functionality that allows our sell-side customers to take their mortgages, digitize them and then patch them through to the buy side, which can then load them into MARS and AIM (our buy-side OMS), and reduce the volume of information they have to re-enter into a trading system. 

Munis is a strange asset class because it is pretty illiquid, but we’ve seen success [in terms of client adoption] across the board, although in the US in particular, especially around automation. For example, if clients see a bond and want to price it quickly, but also want to be confident they get it and at a good price, they can use our automation tools. The solution is linked to [muni bond] price scales, which enables clients to go from pricing and winning hundreds of bonds a day to pricing and winning thousands each day. We’re very excited about that.

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