Chris Allen: Yes, morning everyone. I wanted to follow-up on Dan’s question on the rates. Historically, you’ve talked about market structure impediments to getting bigger in the rates business. What’s the outlook there? There’s a lot of talk around moving to centralized clearing, improvement on settlement times. And then in terms of your penetration level right now, less than 5% of volume, is this just because you’re kind of just getting up to speed right now, just starting to slowly build the business? What’s the longer-term opportunity set do you see there?
Douglas Cifu: Yes, I’m going to do something that you will never hear me say on an earnings call and complement the chair of the SEC in terms of centralized clearing of treasury products and real-time reporting or relatively real-time reporting or trace for treasuries. All of those things are positive, I think, for the marketplace. And certainly, those are initiatives that this SEC has undertaken, and we have been publicly and privately very supportive of those because I think it enhances competition. So, I think what has changed in the marketplace is a little bit of that. I mean the natural efficiency of the marketplace, I mean 10 years ago, even five years ago, these were marketplaces that were largely dominated by the big dealers.
I think the buy side has gotten smarter in terms of seeking alternative liquidity providers. There are dozens of those. And we now have credibility with the distributors of the product, i.e., the TradeWebs and the Bloombergs of the world who are great business partners of ours. I should — MarketAxess, obviously, bought LiquidityEdge, and so we work with them as well, so using those partners to enable our distribution and to give us credibility. I mean it’s always a fight Chris, to get into the wheel, if you will, on the buy side. So, they don’t — they can’t enable 30 liquidity providers. It’s no different than in equities and what we do in our business and alert, et cetera. So it’s understanding who the key counterparties are getting credibility with the distribution channels and the TradeWebs, the Bloombergs, the MarketAxess’ of the world and then providing good real-time pricing.
I mean, just yesterday, we were engaged on this with some senior folks at TradeWeb to understand who the main clients are, how we can get better, what they’re looking for in terms of mark-outs and response times. It’s the blocking and tackling of market making, which we’re very, very good at, but it’s a very competitive marketplace with dozens and dozens of competitors and hundreds of hundreds of counterparties. So, sifting through all that to build out the right offering and provide value to the market is what we’re doing. So, — but we’re in the top 20 on TradeWeb right now, which is great. But obviously, we would like to be in the top 10 and ultimately in the top five, whether that’s realistic or not given the competitive nature of that market.
But I think our scale gives us an advantage. And again, the fact that we’re multi-asset class. So, to the extent, these rates products manifest themselves either as a future in ETF, obviously, those are marketplaces that we have access to as well. And we always pride ourselves in being the most efficient provider of the two-sided “that’s a nice way of saying, we manage our expenses.” And so we can tighten up our prices in order to be competitive. So, again, this is just kind of Virtu 101, how to build the business. This is clearly different than some of the other than US equities, but it’s in a marketplace that we think is eminently addressable by our product offer.
