Bond managers 'nervous' about banks' role in liquidity projects

Fixed income managers have expressed concerns over a new initiative to boost shrinking liquidity in bond markets, fearing the inclusion of 15 banks will cause price swings in the market.

Investment Week reported last week the Neptune Collaboration has been launched as a not-for-profit iniatiative looking to increase trading of corporate bonds, boosting liquidity in the fixed income market. It was soft-launched in April and is already backed by 15 banks and 27 asset management firms including Aviva Investors and J.P. Morgan. Groups involved now send pre-trade indications to their clients across the Neptune pilot production network and receive pre-trade indications from multiple banks, simplifying the trading process. Gross: Bond liquidity problems "scares the hell...