Technology is also transforming the capital markets. Trading across asset classes continues to migrate away from trading pits and phones to electronic venues. Regulatory changes enacted after the global financial crisis have accelerated this shift as higher capital and liquidity requirements for banks have restricted their ability to act as effective market-makers. MarketAxess Holdings Inc. (MKTX, Financial) operates the dominant electronic platform for trading corporate bonds. We believe the corporate bond market is in the early innings of a secular shift from voice-based trading to electronic trading, and that MarketAxess will be the prime beneficiary of this transition.
From Baron Funds' May 2016 Baron Insight: Investing in Financials.
