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IBKR’s Request for Quote (RFQ) for Bonds

Lesson 8 of 9
Duration 3:12
Level Intermediate
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Interactive Brokers allows clients to trade a variety of bonds and provides access to more than 40,000 corporate issues globally. Because we draw upon multiple vendors and electronic ATS venues, bond investors should achieve best price execution. Interactive Brokers neither marks-up its fixed income pricing nor artificially widens the price spread. Clients therefore have access to the best possible prices from a variety of vendors at a low commission.

Study Notes:

This video will demonstrate how to use the RFQ function in order to request a quote for trading non-investment grade bonds designed to help you get the best possible price for your trade.

Unlike stock quotations, bond prices may often appear without a quote because they trade infrequently. On some occasions you may see either a one-or-two-sided quote. You may also be able to view the bid or ask size associated with the current price quote. Again, you may not be able to see volume if there is no quote available.

Use the RFQ function to request a quote from one of our available vendors. Here’s how it works.

Use the RFQ function to request a quote from one of our available vendors. Here’s how it works.

  1. Access the Classic TWS interface.
  2. Add a bond to your quote monitor, ensuring that you selected the SmartRouted bond.
  3. Right-click on the line and from the pop-up menu locate Create RFQ.
  4. A new row is added beneath the existing quote. You must now input two pieces of information.
    1. Click on the input field displaying Buy / Sell and choose one from the dropdown menu to show your interest.
    2. Enter the number of bonds you wish to transact.
  5. Click the RFQ button to submit your expression of interest.
  6. Returned quotes will appear below the symbol line displaying either the bid or the ask specific to the volume of bonds you indicated that you wanted to transact.

IBKR will use a rules-based methodology to route your request to one of our vendors.

Routing requirements may require minimum face value for bonds on occasion.

In either case, expressions of interest to interact with your potential order are invited via those networks. The bond venues may return firm prices to Trader Workstation and will be displayed for a period of time. Those quotes are firm for a period but will disappear after a short time. While on screen, you may deal on the displayed quote in the full amount of your order. Should a contributing vendor supply an improved bid or offer price compared to an existing quote, your screen will update to reflect the better price.

Additional Links:

IBKR Bond Marketplace

Request for Quote

Bond Search Tool

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Disclosure: Interactive Brokers

The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Interactive Brokers, its affiliates, or its employees.

Disclosure: Order Types / TWS

The order types available through Interactive Brokers LLC's Trader Workstation are designed to help you limit your loss and/or lock in a profit. Market conditions and other factors may affect execution. In general, orders guarantee a fill or guarantee a price, but not both. In extreme market conditions, an order may either be executed at a different price than anticipated or may not be filled in the marketplace.

Disclosure: Displaying Symbols on Video

Any stock, options or futures symbols displayed are for illustrative purposes only and are not intended to portray recommendations.

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