CDO: Key market research findings
- The Americas dominate the market geographically
- Growth in the integration of financial markets
- Key vendors—Bank of America Merrill Lynch, Citigroup, Goldman Sachs, and JPMorgan Chase & Co
Technavio’s market research analysts predict the global CDO market to grow at a CAGR of around 5% between 2016 and 2020. The dynamic nature of the market structure is the primary driver for growth in the market. Technological advances in straight through processing (STP) drives the forex market by reducing the trading costs and increasing the transaction costs, which results in increased transparency within the system. The Americas accounted for more than 49% of the overall market share and dominated the global collateralized debt obligation (CDO) market during 2015. The increase in the demand for securitized products such as collateralized loan obligation(CLO) and collateralized mortgage-backed securities (CMBS) is expected to boost growth in the CDO market in the Americas during the forecast period.
The new industry research report from Technavio discusses in detail the key drivers and trends responsible for the growth of this market and its sub-segments.
“Enhanced strategic formulation and the adoption of structuring and pricing tools is an ongoing trend in the market. Strategies such as risk management analytics and versatile market standard models help in the shaping and pricing of the currency exchange execution. Various approaches such as the pre-trade analytics tool are used to manage correct currency exposure and support the decision making of the market participants,” says Amit Sharma, Lead Analyst, ICT, Technavio Research.
The increase in the integration of financial markets directly influences the liquidity in the equity market. Integrated financial markets enable domestic investors to buy foreign assets and foreign investors to buy domestic assets by reducing the risks involved. The efficient global allocation of savings for future use helps countries create an opportunity for portfolio diversification, sharing of the risks, enhancing growth, and raising the standard of living. Furthermore, greater involvement of trading through the clearing house has a positive impact on financial market integration.
The key vendors in the market include Bank of America Merrill Lynch, Citigroup, Goldman Sachs, and JPMorgan Chase & Co. Factors like the recent increase in customer expectations and peer-to-peer lending and cryptocurrencies have increased opportunities in the market and have attracted a large number of market participants from both the domestic and international markets. Though the market currently appears complex and unregulated, expected partnerships among central banks will regulate the market. Additionally, the collateralized loan obligation market will also witness some acquisitions by larger vendors.
A more detailed analysis is available in the Technavio report, Global CDO Market 2016-2020.
We can customize reports by other regions and specific segments upon request.
Other related reports:
