A conversation with Sarah Bendl, Sr. Product Specialist, Portfolio Trading

Sarah Bendl has been instrumental in driving the transformation and expansion of Portfolio Trading (PT) at MarketAxess. Joining the company in 2018 through the Operations Rotation program, Sarah has been at the forefront of the firm’s growth in Portfolio Trading, contributing significantly to its expansion and strategic development.

Following her rotation in Client Services, Sarah transitioned to the Portfolio Trading desk during a critical period of business expansion. In her role as Senior Product Specialist for Portfolio Trading, she leads strategic PT initiatives and has managed key developments in the platform's progress, including expanding into new asset classes, the integration within X-Pro, and delivering consistent growth—establishing MarketAxess as a leader in electronic fixed income portfolio trading.

The Explosive Growth of Portfolio Trading

Portfolio trading has grown exponentially since Sarah joined the PT team three years ago—last year, PT grew more than 57% from the year prior. One of the most notable trends has been the increasing size of trades.

"The aggregate trade size keeps getting larger," says Sarah. "If you look two years back, the average PT size for IG was somewhere around $60 million. Now it's around $100 million."

This growth has led to the emergence of "jumbo PTs"—trades exceeding $1 billion in size. Sarah notes that jumbo PTs now occur daily, with baskets in the $8-10 billion range occurring more frequently. She attributes this growth in part to the efficiency that comes with PT. “The ability to price and process these significant risk transfers has dramatically improved; these trades can now be executed efficiently within an hour via PT,” she says.

Another significant trend is the emergence of cross-asset portfolio trading. Over the past year, the market has been moving toward including diverse asset classes within a single portfolio trade.

"Many of these jumbo PTs now incorporate Asset Backed Securities, Munis, and Treasuries, mirroring the diversity of assets in the commonly used ETFs and benchmark indices," Sarah explains. In the past year, Sarah also oversaw the launch of Muni PT, with MarketAxess announcing the first Portfolio Trade for Tax-Exempt Municipal Bonds in June 2024.

Additionally, MarketAxess recently integrated ETF analytics within X-Pro, displaying ETF overlay and premium/discount using their CP+™ NAV on the pre-trade screen.

X-Pro: The next generation of PT

The X-Pro platform has contributed greatly in advancing MarketAxess's PT capabilities.
It enables rapid integration of valuable data features including:

• Pre-trade TCA (Transaction Cost Analysis)

• ETF analytics on the pre-trade screen

• Enhanced functionality for managing hundreds of line items on the live trade screen

• Sector, maturity, and credit rating breakouts

• Outlier analysis

One of our most recent innovations is Axed PT, a first step in improving the ecosystem for dealers and clients to manage the exhaust from jumbo portfolio trades.

"The goal of Axed PT is to help dealers more efficiently redistribute the risk, especially off the back of those jumbo PTs," Sarah says. "More efficiency around exhaust will actually promote better execution on the initial PT. Dealers know they can get out of that risk fairly quickly and seamlessly."

Looking ahead, Sarah sees portfolio optimization as the next frontier for PT. The team is exploring how products like CP+—the MarketAxess AI-powered, algorithmic pricing engine for global credit and rates markets—can help clients make informed decisions.

"Given the strength of CP+, how can we use that data to give clients an idea of portfolio optimization pre-trade? What bonds within the PT are impacting the portfolio, depending on what the client's goal is?" Sarah says.