Goldman Sachs is going for growth in flow fixed income trading. When then-COO Harvey Schwartz presented his plan for the bank's fixed income currencies and commodities (FICC) division last year, it was all about chasing corporate clients and becoming a bigger liquidity provider. In practice, Goldman insiders say this means the bank is going after flow revenues and moving away from its historic focus on structured products.
In the process, it seems Goldman is building a whole new team to build market making and risk systems for flow products in the fixed income market from scratch.
Titled ION Engineering, the team will be based in New York, London, Hong Kong and Bengalaru with positions currently being advertised in each city. It will comprise both technologists and securities professionals.
In adverts for the ION technology roles, Goldman says the new team has a mandate to, "design and build applications to power market making and risk management for standardized products in FICC," and that the new systems will be designed from the "ground up," across the "full application software stack." Team members will work with, "salespeople, traders, and business stakeholders to design, build, deploy and monitor critical market making and risk management systems."
We didn't speak to Goldman Sachs for this article, but construction of the ION team suggests the bank is keen to maintain the momentum of the first half of this year, when its fixed income revenues rose 32% compared to 2017, and to compensate for the years of under-investment in electronic trading systems that allowed Morgan Stanley and J.P. Morgan to seize market share.
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