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Overbond has launched a new artificial based-smart order routing (SOR) system, following on from the recent launch of its bid-ask liquidity scoring model.

The buy-side can utilise the automated process of SOR for online trading specifically, working for best execution through allocating based on price and liquidity. The algorithm also, when needed, has the capacity to determine optimal methods of breaking up (or chunking) a trade.

In the development of its offering, Overbond worked with both buy- and sell-side partners. Specifically, the system is an AI-enhanced routing logic to provide traders with a complete view of order break downs.

Speaking in an announcement, the business highlighted that AI-driven tools are critical for achieving no-touch end-to-end bond trading automation and may contribute to the continuing increase in automated trading of fixed income.

Read more: Overbond expands automated bond trading service with Deutsche Brse European fixed income data

Overbonds developed analytics auto-adapt to trade size and direction, which allows traders to view data across hundreds of thousands of fixed income securities.

Traders can view implied liquidity and confidence scores which have been sourced from volatility and bid-ask spread components. Overbond employs a three-tier system, dependent on liquidity and pricing confidence relative to the universe of bonds with the same currency.

Vuk Magdelinic, chief executive of Overbond, explained: Gauging liquidity and routing orders are pivotal steps in the trading process and enhancing them with AI can help traders manage their workflow more efficiently, automate more trades and improve profitability. At Overbond we have a strong team of data scientists and developers who are working hard to innovate and push the boundaries of what AI can do in the fixed income markets.

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Overbond unveils new artificial intelligence-based smart order ... - The TRADE News