Fix for fixed-income uptake remains slow

Buy-side firms are continuing their ‘wait-and-see’ approach when it comes to implementing the Fix protocol to support their fixed-income businesses, according to Fix Protocol Limited (FPL).

FPL – the organisation driving the development and implementation of the Fix protocol – has initiated a push to increase fixed-income fund managers’ awareness of the technology’s benefits through its global fixed-income committee (GFIC).

FPL said the April launch of version 4.4 of the protocol would, due to tough market conditions, probably attract firms that until now focused more on cost containment and continuity planning than on new technologies. Version 4.4 is tailored more for fixed-income products than previous versions.

The committee also intends to set up a certification programme for buy- and sell-side firms and electronic communications networks, to test the Fix protocol for fixed-income securities. Daniel Doscas, chairman of the GFIC, said the programme has yet to start officially, and is still in the preliminary stages. "We thought it would be a good way to bring the entire fixed-income community up to speed on how to use Fix, what the message types would be, and the differences between the session and application layers," said Doscas. He added that while vendors are being approached to gauge their interest in participating and discussions with the FPL global steering committee are under way, details of the certification programme are likely to be laid out in March. Then the steering committee’s approval will be necessary before any programme can commence.

Doscas acknowledged that up to now many fixed-income fund managers’ interest in the Fix protocol, especially on the buy side, has not been exceptional, which he attributes to technology issues. "It’s taken us some time to take the equity protocol and add the attributes of a fixed-income instrument," he said, adding that the enhancements included in Fix 4.4 should allay those concerns.