BidWanted FIX 4.4 workflow

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Imported from previous forum

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I am new to FIX fixed income messages and I need a little help in using the correct message types for Bid Wanted and Offerings. Our workflow is as follows: We have Bid Wanted items that receive bids by various customers. This model works fine internally but we would like to send out Bid Wanteds to counterparties and have them send bids for our items. I saw the fixed income workflow in volume 7 which used the Quote message type. Quoting bonds seems to be based on pricing for those bonds. Our Bid Wanteds dont having pricing information. What would a typical workflow look like for Bid Wanted? For our Offerings the Quote model seems to work in that all of Out offerings have pricing associated with it.

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There are four FIX messages that might serve your business requirements – all described in Vol 3 of the specification:

  1. Indications of Interest are probably the most informal way of marketing priced securities and are broadcast unsolicited to counterparties by market makers. Indications come with no commitment to trade and are distributed with the understanding that other firms may react to the message first and that the securities may no longer be available. IOIs require no response. If interested the receiver will place a limit order with the price “previously indicated” which you may then fill or reject if the inventory is gone or the market has moved.

  2. RFQ Request is sent by liquidity providers to indicate to the market for which instruments they are interested in receiving Quote Requests.

  3. Quote Request is used by liquidity takers to solicit quotes on one or more securities from specific counterparties. This initiates a rather formal dialog with obligatory timed responses, and as you note there are flow diagrams in the FIX spec for various trading models and industries. This is often used for publishing fixed income bid and offer lists. Prices are usually not provided particularly for fixed income bid requests but they can be included to signal the requestor’s price points.

  4. Quote is used as the response to Quote Request but it can also be broadcast unsolicited to advertise inventory on offer and bid interest perhaps with a firmer trade commitment than an IOI. If many quotes are to be published at once, Mass Quote may be a more space-efficient alternative, but in either case your counterparties may need you to filter content to preserve band-width. An unsolicited Quote message does not require a response when the receiver has no interest to trade.

Before making a decision which messages to implement you should survey your counterparties to see what they are prepared to process. Then publish a Rules of Engagement document since the protocol doesn’t define either the message flow or how to interpret content in your particular business.

I am new to FIX fixed income messages and I need a little help in using the correct message types for Bid Wanted and Offerings. Our workflow is as follows: We have Bid Wanted items that receive bids by various customers. This model works fine internally but we would like to send out Bid Wanteds to counterparties and have them send bids for our items. I saw the fixed income workflow in volume 7 which used the Quote message type. Quoting bonds seems to be based on pricing for those bonds. Our Bid Wanteds dont having pricing information. What would a typical workflow look like for Bid Wanted? For our Offerings the Quote model seems to work in that all of Out offerings have pricing associated with it.

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Dean indeed explained various choices here. Another way to resolve your problem is to select appropriate value for tag 423 (PriceType) to meet your requirements. You can always define custom tags and custom tag values to enhance your API. You should work closely with your counterparties to make appropriate choices, since backward compatibility is always a long term concern when building APIs with counterparties.

There are four FIX messages that might serve your business requirements – all described in Vol 3 of the specification:

  1. Indications of Interest are probably the most informal way of marketing priced securities and are broadcast unsolicited to counterparties by market makers. Indications come with no commitment to trade and are distributed with the understanding that other firms may react to the message first and that the securities may no longer be available. IOIs require no response. If interested the receiver will place a limit order with the price “previously indicated” which you may then fill or reject if the inventory is gone or the market has moved.

  2. RFQ Request is sent by liquidity providers to indicate to the market for which instruments they are interested in receiving Quote Requests.

  3. Quote Request is used by liquidity takers to solicit quotes on one or more securities from specific counterparties. This initiates a rather formal dialog with obligatory timed responses, and as you note there are flow diagrams in the FIX spec for various trading models and industries. This is often used for publishing fixed income bid and offer lists. Prices are usually not provided particularly for fixed income bid requests but they can be included to signal the requestor’s price points.

  4. Quote is used as the response to Quote Request but it can also be broadcast unsolicited to advertise inventory on offer and bid interest perhaps with a firmer trade commitment than an IOI. If many quotes are to be published at once, Mass Quote may be a more space-efficient alternative, but in either case your counterparties may need you to filter content to preserve band-width. An unsolicited Quote message does not require a response when the receiver has no interest to trade.

Before making a decision which messages to implement you should survey your counterparties to see what they are prepared to process. Then publish a Rules of Engagement document since the protocol doesn’t define either the message flow or how to interpret content in your particular business.

I am new to FIX fixed income messages and I need a little help in using the correct message types for Bid Wanted and Offerings. Our workflow is as follows: We have Bid Wanted items that receive bids by various customers. This model works fine internally but we would like to send out Bid Wanteds to counterparties and have them send bids for our items. I saw the fixed income workflow in volume 7 which used the Quote message type. Quoting bonds seems to be based on pricing for those bonds. Our Bid Wanteds dont having pricing information. What would a typical workflow look like for Bid Wanted? For our Offerings the Quote model seems to work in that all of Out offerings have pricing associated with it.