Human traders are increasingly losing out to machines in the world's biggest bond market.
While investors traditionally negotiated prices for U.S. Treasuries by telephone, they're increasingly turning to computer-based marketplaces for a range of price quotes from different dealers. A record 48 percent of trades in U.S. government debt have occurred on electronic platforms this year, up from 31 percent in 2012, according to a study released yesterday by research firm Greenwich Associates.
Bond managers are looking for more efficient ways to determine values in a US$12 trillion market, as banks use less of their own money to opportunistically buy and sell, giving them less of an edge when they pitch their brokerage services.
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