Good morning. And welcome to Tradeweb’s Second Quarter 2021 Earnings Conference Call. As a reminder, today’s call is being recorded and will be available for playback. To begin, I will turn the call over to Head of U.S. Corporate Development and Investor Relations, Ashley Serrao. Please go ahead.

Thank you and good morning. Joining me today for the call are our CEO, Lee Olesky, who will review the highlights for the quarter and provide a business update. Our President, Billy Hult, who will dive a little deeper into some growth initiatives. And Bob Warshaw, our CFO, who will review our financial results. We intend to use the website as a means of disclosing material, non-public information and complying with disclosure obligations under SEC Regulation FD. I’d like to remind you that certain statements in this presentation and during the Q&A may relate to future events and expectations, and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements related to, among other things, our guidance, are forward-looking statements. Actual results may differ materially from these forward-looking statements. Information concerning factors that could cause actual results to differ from forward-looking statements is contained in our earnings release and periodic reports filed with the SEC. In addition, on today’s call, we will reference certain non-GAAP measures. Information regarding these non-GAAP measures, including reconciliations to GAAP measures are in our posted earnings release and presentation. To recap, this morning we reported GAAP earnings per diluted share of $0.27. Excluding certain non-cash stock-based compensation expense, acquisition related transaction costs, acquisition and Refinitiv related D&A and certain FX items, and assuming an effective tax rate of 22%, we reported adjusted net income per diluted share of $0.39. Please see the earnings release and the Form 10-Q to be filed with the SEC for additional information regarding the presentation of historical results. Now, let me turn the call over to Lee.

Thanks, Ashley. Good morning, everyone, and thank you for joining our second quarter earnings call. We have previously talked about how historical exogenous events like the acceptance of the internet or the waves of regulation that unfolded in the financial markets created opportunities for Tradeweb to drive change. And in doing so, we continued to move markets forward on their journey towards more electronification. This time is no different, more than a year after the pandemic, we believe our second quarter results are a testament to the ability of our people to innovate with our customers and solve complex trading challenges. And more importantly, drive enduring behavioral change. Despite a macro environment that was relatively subdued compared to last year, Tradeweb experienced a record first half notching up four months where clients traded in excess of one trillion dollars on average daily. Turning to slide four, this enduring behavioral change I just described was on display as we reported our second best revenue and volume quarter. Specifically, gross revenues of $261 million were up 23% year-on-year on a reported basis and 20.2% on a constant currency basis. The three main drivers of our growth in the second quarter were U.S. Credit, global swaps and U.S. Treasuries. The revenue growth and the resulting scale translated into improved profitability year-on-year as adjusted EBITDA margin expanded by 280 basis points to 50.6%. Turning to slide five, this quarter was marked by strong performance across many of our asset classes with credit and rates accounting for 47% and 43% of our revenue growth, respectively. Specifically, credit posted its second best quarter, driven by record U.S. high yield and strong U.S. investment grade and European credit trading. Cash rates revenues were another highlight driven by healthy central bank issuance, which continues to fuel global government…

Thanks Lee. Turning to slide seven for a closer look at credit. We produced another very strong quarter with both IG and high yield hitting new records for revenue and share. Our formula remains the same, listen to our clients, offer a variety of execution protocols and relentlessly innovate to shape the future of credit trading. Clients have responded to our brand of innovation by increasingly adopting AllTrade, portfolio trading and net spotting. Equally important to the growth of our U.S. Credit business, has been the rapid increase in RFQ activity as we cross-sell and continue to gain more wallet share. RFQ is our biggest institutional protocol, with volumes growing 39% year-on-year during the second quarter. The strong growth in credit goes beyond our institutional channel. Our fast-growing wholesale and retail middle market businesses continue to perform well with revenues up significantly year-on-year. Stepping back, the diversity of our credit growth has never been stronger and while we are pleased with the progress made so far, we strongly believe that we have the potential to do even better. Portfolio trading, which I refer to as a light bulb solution has become synonymous with Tradeweb. It is a prime example of the strong feedback loop we have with our clients. It’s a great protocol that has cemented itself as an efficient risk transfer solution by improving upon some of the limitations of list trading using traditional RFQ and all-to-all. Portfolio trading is structurally changing client behavior and demand continues to build. Tradeweb facilitated a record $74 billion in portfolio trades in the second quarter of 2021, an increase of more than 125%. Clients are also increasingly putting dealers in competition, our in-comp portfolio trading reached record levels comprising 73% of volumes, up from 39% in the second quarter of last year.…

Thanks, Billy, and good morning. As I go through the numbers, all comparisons will be to the prior year period, unless otherwise noted. Let me begin with an overview of our volumes on slide nine. We reported our second highest quarterly average daily volume of $976 billion, up nearly 26% year-over-year and up 25% when excluding short tenor swaps. Areas of notable growth include, U.S. government bonds, European government bonds, swaps created in one year, U.S. corporate credit, European corporate credit, institutional U.S. ETFs and repos. Slide 10, provides a summary of our quarterly earnings performance. The second quarter volumes translated into gross revenues increasing by 23% on a reported and 20.2% on a constant currency basis. We derived approximately 37% of our revenues from international customers and recall that approximately 30% of our revenue base is denominated in currencies other than dollars predominantly in euros. Our variable revenues increased by 33.7% and our total trading revenue increased by 24.4%. Total fixed revenues related to our four major asset classes continued to grow up 7.9% and 4.4% on a constant currency basis. Credit fixed revenue growth was primarily driven by the addition of new dealers in U.S. Credit and additional clients in Chinese bonds. Equities fixed revenue growth was driven by the addition of new dealers and the impact of FX. Other trading revenues were up 2.5%, and as a reminder, this line item is lumpy and is affected by periodic revenues tied to technology enhancements formed for our retail clients. Market data increased by 8.2% due to growth in Refinitiv, APA and proprietary data products. Adjusted EBITDA margin came in at 50.6% and expanded nicely by 280 basis points relative to second quarter 2020 as we continue to benefit from scale. All-in, we reported adjusted net income per diluted…

Thanks, Bob. The operating market remains subdued. Low credit volatility and low rates are certain -- certainly not supportive. However, we continue to focus on helping our clients digitize their workflows to drive market share growth and what we believe is shaping up to be another record year for Tradeweb. This focus coupled with the multiyear secular trends powering electronification and automation point to potential for a long runway for growth. We are moving forward to capitalize on these trends, as Bob mentioned by continuing to invest in our people, technology and network. In addition to organic growth, we continue to spend time evaluating potential M&A opportunities that we believe would further augment our network given our cash position. With a couple of important month end trading days left in July, momentum from the second quarter has continued with overall volumes up double digits relative to July 2020. The strong volume growth is being led by all asset classes. Electronic IG credit market share is running in line with last quarter while electronic high yield credit share is running higher with notable strength across portfolio trading and AllTrade. Before I conclude, I would like to welcome Balbir Bakhshi to our Board of Directors. Balbir brings an enterprise perspective shaped by a wide range of risk management roles. As we continue to grow and broaden our reach, this perspective will be vital to our board and management team. I would also like to thank Brian West for his 2 plus years of service on our Board and wish him all the best in his new role as CFO for Boeing. I would like to conclude my remarks by thanking our clients for their business and partnership in the quarter and I want to thank all my colleagues for their efforts that contributed to the strong quarterly revenues and volumes at Tradeweb. With that, I will turn it back to Ashley for your questions.

Thanks Lee. As a reminder, please limit yourself to one question only. Feel free to hop back in the queue and ask additional questions at the end. Q&A will end at 10:30 a.m. Eastern time. Operator, you can now take our first question.

And thank you. And our first question comes from Chris Allen from Compass Point. Your line is now open.

Good morning, guys. With the eSpeed closing about a month in, I was hoping you maybe could provide a little bit more granularity around the deal in terms of what you are hearing from clients, what the opportunity set is from a market share perspective, where it kind of currently stands and what other opportunities are there to improve the platform moving forward?

Thanks, Chris. Good question. Yeah. So we are very excited about the potential for the business. It’s now residing within our Dealerweb franchise, and from our perspective, this is a market that we have been involved in literally for decades. So our collective relationships, the clients we have, the connections that we have with those clients are really very strong and essentially this is really beginning of our company. I refer to it as our kitchen. So it’s in our DNA. It’s a part of our business. I think that with respect to your question, we look at this as if it’s an opportunity for significant growth, because the customers want competition in this space, in this central limit order book space, that historically has been split among a couple of different participants, eSpeed, BrokerTec. And I think that customers, the dealers and other participants, are really looking for a more balanced situation. So, that’s a starting point. I think the other thing that we have that really helps us in this whole structure is it’s a combination of all different protocols now that we are offering across the treasury market, right? So, even when you look at the dealer market, we will be able to combine both a CLOB and a streaming offering which will be unique. That will be eventually moved to a single API, which will reduce connectivity costs for our clients and save the money. But overall it’s this outreach to customers, the relationships we have. That’s really an advantage for us here. And the kicker I think really gets back to what we always talk about at Tradeweb, which is people. And with respect to this business, we will invest in the team, in the talent. We recently hired Dan Cleaves, who was a former leader at BrokerTec, who was back at the business when I started BrokerTec many years ago, very experienced hand. We are really thrilled that him on board. We have got Chris Amen running the business, Joe Noviello, who helped build eSpeed from a technical standpoint. So, it’s really a world-class team and several other individuals. So we are excited about it. We are going to bring a lot of new energy to this business. We think we will revitalize the business, and I can say, it’s only a month into it, but the initial signs are really encouraging and strong and we think there’s a lot of potential.

And thank you. And our next question comes from Brian Bedell from Deutsche Bank. Your line is now open.

Great. Thanks very much for taking my question. Maybe oriented towards Billy and/or Lee. Totally focusing on portfolio trading in the corporate bond market. So, multipart question. First of all, if you can attribute some of your share gains in the last few months to portfolio trading versus other protocols within credit? And then, I think, Billy, you mentioned the 25% of trades in that survey being done through portfolio trading. I guess maybe if you can offer some perspective on when you think the market would move to that or if it would move to that, the proportion of trade in the portfolio trade? And then just on dynamic, you mentioned about certainty of execution versus the quality of execution that’s in list trading, if you can comment on that and then just your long term defensibility of your portfolio trading protocols?

Sure. Hey, Brian. How are you and thanks for the question? No. It’s interesting. On these kinds of market innovations and definitely, as we all know, portfolio trading is kind of having its moment in the sun. There’s always this kind of interesting sort of back and forth debate kind of conjecture on like how sort of impactful this innovation will be. And as we were kind of really getting behind the steering wheel on this a bunch of years ago, I think we did sort of exactly what you would expect us to do, which was like highly engage with our clients, collaborate with our clients and the colonel was always about what you referred to, which is, how do I get my hard to price line items with better execution, right? And so that all became around certainty of execution, hit rate, minimization of information leakage, right? And so today we sit back, and yeah, absolutely, it’s a big driver of our credit market share 100%. We think we are playing the leadership role around portfolio trading. As you know, June was a record month for us in portfolio trading. It’s now I think I quoted that’s 5% of the TRACE volume. And really what that evolution now is all about and where it’s going is this kind of, this further evolution around portfolio trading becoming a real risk transfer protocol, a real risk transfer mechanic. And so as we kind of look at the stats, I mentioned, I think in the quarter the average was 107 line items at $82 million size. We did a trade. That was like almost 900 line items over $2 billion, right? So now we are really and truly getting into the kind of risk transfer game, right? Lee’s always mentioned, innovation is one thing, but then how do you continue to kind of further innovate it once you have that leadership position. What is that kind of feedback loop and how are you continuing to kind of hone your skills? We have always said this like, very healthy respect for the competitive landscape in the space, right? So, there’s no sleeping on our leadership position. We are going to continue to innovate portfolio trading and continue to kind of build that moat. Part of that’s going to be about things like now we are allowing dealers to quote portfolio prices on a reference price, not just outright. That’s going to be something meaningful. That’s going to help us get at more of those kind of voice TRACE. And at the end of the day we feel like we are really kind of on to something significant with portfolio trading and it’s continued to be one of the big drivers of our credit market share and thanks for the question. And thanks for your question.

Yeah. No. Thanks very much.

Thank you. And our next question comes from Rich Repetto from Piper Sandler. Your line is now open.

Yeah. Good morning, Lee and Billy, and Bob. Just to keep hammering away on the credit issue here. Away from, well, first, thanks Billy for the prepared remarks, because you sort of expect, I think you said, portfolio [Technical Difficulty] what -- whoever you use that sort of prediction. But I guess my question is, even if you had 100% of the 5%, it doesn’t explain all your credit market share gain over the past year, over 600 basis points. So can you explain, Billy, sort of why you have done well where we see peers talking about the low volatility, the tight spreads that caused them to lose market share other than the portfolio trading?

Well, it was to feel good. Rich, it’s a great question, right? It’s putting the pieces of the puzzle together. And way back when we sensed there was an opportunity for the company in credit, but we knew we needed to differentiate ourselves. And that differentiation was really around, and you have heard us talk about this, net spotting and net hedging, that was the first version of it. And now we feel like we are really playing a leadership role in portfolio trading. Some of the other business now is coming as a consequence of that, right? So our RFQ business is up significantly. And I do point to this very basic principle and I do think it’s important, which is the marketplace really does want to competition in credit. And so as we are doing these things, I think, that are really adding value for clients and really creating a differential for clients. We are starting to see some of that other type of business come our way as a follow-up. And I would -- that I would describe to you as the traditional kind of RFQ business, which has done exceptionally well for us this past quarter.

Thanks. I will get back in the queue, but congrats on the share gain.

Thank you, Rich.

And thank you. And our next question comes from Alex Blostein from Goldman Sachs. Your line is now open.

Okay. Awesome. Hey. Good morning, everybody. So maybe continuing along the questions with respect to credit. I really was hoping going in on the AllTrade as a bucket for you guys, lots of growth, particularly this quarter. There’s a lot that goes in there. So I was hoping you can help us sort of parse through some of the composition of AllTrade today? Maybe you can talk about it in terms of dealer-to-dealer versus dealer-to-client volumes? And then, specifically, any color you could provide with respect to all-to-all within AllTrade specifically and either sizing it or any stats with respect to the number buy side participants that are coming into that protocol, because obviously it’s been an important industry dynamic as people look to execute in an anonymous way in an all-to-all fashion. So, it would be helpful to break that out? Thanks.

Thanks for the question. It’s -- I am going to start out by talking a little bit about all-to-all volumes and what’s going on there, because I think it’s kind of interesting. Billy talked about that in his prepared remarks and we showed some information about it as well. It’s -- one of the interesting things about all-to-all for us is we are starting to see what we think is critical mass. Why is that happening? It’s happening for several reasons. One is that we are starting to see more hedge funds coming onto our platform. That generally means that there’s an acceptance that we have hit the levels of liquidity that we need to have to be able to satisfy the trades and that’s kind of a good hint of a healthy ecosystem as we build it further. The feedback we are getting as well is that the market really wants a competition. Isn’t really just a competition, it’s really a competition about capabilities as much as anything else. It’s what features and other things that can be added to the environment that will drive engagement higher. And I think that what we think is happening is -- and we are starting to see is, particularly in high yield sort of a growing interest in the way we are doing things and particularly the volumes and the participants that we have. We think that we are doing some other things as well that are really important. We are exposing all network to retail participants, retail liquidity providers and we are having all-to-all network participates in rematch protocol after a session. We have talked about that in the past the way that we sort of draw wholesale interest into the same common universe. So it’s really our story of we have these different participants and they share the ability to get to our liquidity pools, which increases the viability of those pools and the importance of those pools. And so, I think, that’s a really important part about price discovery and all the other parts it is what attracts and builds volume.

Yeah. I think, Alex, just add to Bob’s point. It’s a really good question, but it’s this virtuous circle I think that we have been after where we are trying to -- you have heard me use this expression before, connect the dots between different markets, between different protocols, between different customer segments. And that is the differentiator for Tradeweb. So, not only do we have the all-to-all in what we call AllTrade, not only do we have portfolio trading, we also have session trading. And the session trading comes from our price generation, right? So these matching sessions occur because we have such strong pricing information, which is coming from our AI pricing. That’s a combination of all the sources of data that gives the market confidence to match at a point that we have set the standard at. And so you have to think about these things. I do think holistically and as best you can to connect them. Bob was giving an example of, well, if it doesn’t match in a session, we kind of waterfall it to the next thing. So you are going to continue to see from us, the use of -- really is almost algorithms and pricing and links between different customer segments and different types of protocols that allow for a larger aggregate number of matches where you have got the buyer and the seller meeting through, what I would say is, an assisted sort of software enhancement through all of these different protocols, different customer segments and different types of protocols. Thank you.

And thank you. And our next question comes from Ken Worthington from J.P. Morgan. Your line is now open.

Hi. Good morning. Thanks for taking my question. I wanted to go to the durability of credit trading and how the durability of that business is improving as your market penetration grows and I think we saw volumes in market share trail off in the early days of COVID. I think it exposed sort of session trading as being a bigger part of your business. And I am wondering ultimately how you see the durability of credit kind of evolving in different environments with initiatives like rematch and portfolio trading growing? And then, for initiatives like treasury spotting, it looks like, I think at one of your slides, that treasury spotting is a shrinking part of credit. And I know you spoke about the continued success that you are seeing in spotting, but is that part of credit becoming or is credit becoming less dependent on that service over time?

Let me take a crack at that, Ken. Thanks for the question. So, look, I think, when you talk about the -- I am not sure I 100% understand your question. I think when you are talking about durability in different market conditions, you are referring to volatility and if you go back to the beginning of the pandemic, we had this extreme situation and our market share dropped because of all the extreme activity happening in credit. Obviously, it rebounded pretty quickly and we are at a point now where we have accelerated considerably over a number of months. I think it’s a mistake to get too caught up in the moment of what’s happening in the markets. The markets are going to go up and down in terms of volatility. Volumes will surge. They will retreat. And I think what’s really critical here is not predicting what the next bout of volatility will be in a market, but rather to be focused on having a complement of tools and types of ways firms can match with other firms, we call protocols to deal with any type of environment, right, any type of market environment. And that’s -- when Billy was talking before about innovation and our ability to kind of stay one step ahead of the competition, which we have been doing historically now for a couple of decades, that is the key, right? Figuring out what is going to be an acceptable protocol, linking it together, rather than necessarily kind of focusing on the durability of a particular moment with respect to volatility. That’s not what we try to do. We are trying to solve for problems that our customers have in a variety of different environments, different segments. And the advantage of that is, one thing feeds upon another, right? So you just take -- I will go off point a little bit but you take the portfolio stuff that we built years ago, because the team led by Chris Bruner and Billy, of course, saw this coming years ago. We are able to innovate and take it to the next generation, next generation and move it into different asset classes and move it into different regions. And that’s true of things we have done going all the way back to RFQ. So I -- we try not to get too caught up in the moment what’s happening at this particular second in terms of yields, in terms of volatility, because we know for certain, these moments will change. The second question was spotting. I don’t know. I don’t -- do you want to…

It was out of the gate 10, the net spotting and the net hedging, it was a great way for us to open the door in credit, because of our foundation and rates, and because of our ability to solve workflow. And as we have done better and I hear you as you are quoting those kind of stats, it’s actually not surprising at all to us that in some level, that piece of it gets minimized, because we are doing so well in other spots now. But it was 100% the kind of the big door opening for us in credit and it continues to play a large role for clients. It’s a piece of the puzzle and you have kind of heard us both Lee and I use that expression a lot. It’s an important piece but it’s a piece of the puzzle. And now we are seeing a lot of other type of business as a consequence of us playing that leadership role around net spotting and hedging.

Great. Yeah. That was the intent of the question. Thank you.

Thanks, Ken.

Thank you. And our next question comes from Michael Cyprys from Morgan Stanley. Your line is now open.

Hey. Good morning. Thanks for taking the question. I noticed that the share buybacks picked up a bit in the quarter. I was just hoping you could talk a little bit about capital management, how you were thinking about that? And more bigger picture, if you could just update us on how you are thinking about the opportunity to enhance your footprint in growth through M&A? I guess at what gaps remain at this point in the platform or where do you see opportunities in the marketplace where M&A can really help accelerate your penetration as you did with the Nasdaq Fixed Income business. What other opportunities remain and how do you think about the hurdles and requirements that you have for that?

Thanks. Thanks for the question. That’s a lot of question actually. Yeah. I will start with the buybacks. We have been talking about this -- this is a program we put together and we started it in the second quarter in terms of the actual activity. It’s really aimed at limiting reducing dilution related to ongoing compensation, equity compensation and it’s been -- it’s -- to some extent opportunistic. We did have -- we don’t expect to have the same volume of that buybacks in subsequent quarters in second quarter. And -- but we have a plan that we will continue as we have talked about. We have still about $98 million over a two-year period that we are allowed to spend with some rules associated with that and we will do that where -- as it seems appropriate either under the control, that was sort of typical 10b5-1 or in open periods that it makes sense. And so -- but it is longer program, there isn’t any effort to making sudden shifts and trying to make sudden shifts in the way we are structured. So I think there’s that piece to it. You also asked about…

M&A.

What was that?

M&A.

M&A and so -- always get spaced between the two points of the question. M&A, I am going to give that to Lee as the strategy thing. I think the key there is to kind of look at the fact that we are still building substantially a relatively like good amount of flexibility in terms of our cash position. We had over $400 million in 12 months free cash flow, even after the NFI transaction, we still have $100 -- a good amount of money, $680 million on our balance sheet, I think, approximately. And so it says that we still have the ability. We also have the revolver, which we haven’t drawn down at all $500 million. So we still have the ability to support it and we are actively continuing to look for opportunities. We have always talked about those opportunities have to be around networks, products, technology capabilities, geographies that would enhance our current capabilities and that’s an ongoing activity that has a full team of people here in London who spend their time pretty much focused on, looking at opportunities in the marketplace.

Thank you. And our next question comes from Kyle Voigt from KBW. Your line is now open.

Hi. Just a follow up on a prior question on the credit business, you mentioned that RFQ business is benefiting because clients want competition and you are seeing more RFQ flow, because you are winning and having success in Portfolio Trading, other protocols. I am curious when you talk to customers about RFQ, why they are doing more business with you, is pricing a factor at all when you are having those conversations as to why they are doing more? And then, also do you think that there’s explicit client switching that’s occurring from other electronic platforms or is this RFQ growth that you are seeing still really being solely driven by voice conversion?

Good question. Well, listen, it’s a very reasonable and good question and let’s answer it like super bluntly. We are not hearing that sort of pricing is the driver, right? What we are hearing for sure is that we are doing a lot of things right, and as a consequence of that, we are getting more of that business. We feel really strong about where our pricing is, but we don’t feel like that in and of itself is the driver of business. And I am just giving you that information because you asked a question sort of directly from clients. That’s kind of what we are hearing very bluntly. And what was the second part of it was of your question?

Was really -- yeah. Do you think there is explicit client switching that’s occurring from other electronic platforms or is the RFQ growth really being solely driven by voice conversion at this point in time?

I think there’s a lot of voice conversion happening and it’s a great question. There’s a lot of voice conversion happening, right? This is a moment where there’s just so much momentum around electronic penetration. So we feel really strongly about how that voice, traditional voice business is moving our way. I think customers rotate. I think there’s an impulse on customers to rotate. But the general piece of it I think that, we would say, we feel strongly about is that there’s continued voice business that’s converting to electronics.

Yeah. And Kyle, the numbers suggest, right, it’s pretty obvious, the aggregate number of the percentages of the overall market going electronic have surged. We are getting a really fair share of that surge. And I -- obviously, I agree with Billy’s point. I think there is an element of rotation. I think that this innovation though is really a driver of getting customers to take a look at what we have, so whether it was the net spotting that we did early on or the portfolio activity that we are doing. As we innovate and we solve customer problems or challenges, we are more likely to get new customers and customers trying us. And I -- so that’s a benefit and they may have been using other systems, for sure. But they see okay, Tradeweb’s got this in portfolio…

Yeah.

… we are doing that. They have got the links into their treasury market with respect to spotting. These are all really positive developments for the market and so it’s not as if those people are using us for portfolio or for spotting. We are not trading electronically previously. So, clearly, we are picking up some business from some of our competition in that respect. But the big lift has really been this overall growth of digitization that we are seeing in the credit market and those numbers are public. They are out there. You can see it.

I will add one more thing which is interesting in terms of RFQ. We are also seeing our trade sizes increasing and our trade sizes are increasing, if you look at investment grade, I think, it’s increasing by 32% and from high of 91%. Those numbers almost don’t matter. What matters is that they are increasing faster than the average trade sizes are increasing. So that gives you some sense potentially that we are in fact, as Lee had said, electronifying trades that aren’t yet electronic, because of that answer to that formula, yeah.

Thank you. Very helpful.

Thank you. And we have a follow-up question from Chris Allen from Compass Point. Your line is now open.

Hey, guys.

Hi.

Thanks for taking my follow-up. This one is for Lee, I believe. I just want to ask if you have any plans to expand in emerging market credit. I know you have a decent footprint in China and you mentioned emerging markets CDS, but it’s a high growth area that’s ripe for electronification. So any color there would be helpful.

Sure. Thank you, Chris. Yeah. We -- look, we believe EM is going to become increasingly important component of our growth internationally and even domestically here and that there’s plenty of room to grow the network. Our view on this is very similar to what you have heard from Billy and Bob, and you will hear from me constantly, which is, play to your strengths, right? We talk about that internally. We have a very strong market position in the derivatives space and interest rate swaps and CDS. So when we started in EM, we focused on that particular area, EM interest rate swaps. The volumes in EM interest rate swaps were up almost 70% year-on-year. When you look at it, we just expanded into Brazil is the most recent addition back in April. We now have 13 currencies in EM IRS. And if you look at the electronification in EM IRS, that’s very low single-digit, maybe 5% of that market is electronic. So very early innings. We have got the software and the design and the understanding of those markets in addition to the customers connected. So we are going to see more and more of that activity year-on-year. Same thing with portfolio trading, so portfolio trading, we realized was a real positive development for the markets over the last several years that we have been in it. So what do we do? We want to leverage that poll position in the U.S. and Europe with respect to portfolio functionality to tactically expand into EM cash credit. So now clients can trade IG high yield European EM bonds in one portfolio. So it’s a natural extension. We think there’s a big opportunity there to do more and over time you will be hearing more and more from us about this as we work with our clients to go after the areas where we can add value.

Thanks a lot, guys.

Yeah.

Thank you. And we have a follow-up question from Rich Repetto from Piper Sandler. Your line is now open.

Yeah. Again got one last question sort of for Bob here to outperform. On expenses, the previous guidance was at the high end of that range of $560 million. Now, it’s $565 million to $580 million. So, let’s just take the midpoint it’s at $572 million. So it’s up about $12 million from prior year, at least the way an analyst will look at it I guess? And the Nasdaq Fixed Income they are doing roughly $3 million in expense a quarter, so that would be about half of it. So, I guess, the question is where’s the other $6 million? Does Billy really need that to innovate that extra $6 million at the back half of the year?

Well, thanks for the question, Rich. I will let Billy speak for himself. But I think a couple of things. The Nasdaq number has got a little bit more -- absolute NFI number has a little bit more in it. I think we have sort of identified as sort of that we would identify those fences when we take on the business, we also have some D&A that adds to that. So we sort of see the number more closer to $8 million, maybe a little bit more than that, $8 million to $9 million, but in sort of that range of the numbers. And the rest is really just as you described it. It’s a series of we -- some things we think we can put forward in terms of the work we can do in 2021 for things in 2022 that we are thinking about. And there’s, as revenues been going up, of course, there’s still this revenue drives a bit of our compensation expense. So those are the things that are in the number, but it tells you kind of what the big portion of it really is NFI, I think, even NFI is half, it’s little more than that.

Yes.

Yeah.

Yeah. Got it. Billy only needs $3 million to innovate the back...

We are not negotiating, Rich.

And Rich, we almost made it through a whole call without mentioning your jogging speed.

No comment on that. I am faster than what you think.

Yeah.

Thank you. That’s all I have.

Thank you for calling.

Okay. Thank you. And I am showing no further questions. I would now like to turn the call back over to Lee Olesky for closing remarks.

Yeah. Well, I just want to say thanks to everyone for joining us this morning. We have started the first half of 2021 on a very strong note. We remain very excited about the rest of 2021 and tackling the multiyear opportunities in front of us. And obviously, if you have any questions, feel free to reach out to Ashley or anyone on the team and have a great day. Thanks for joining us.

Thank you. This concludes today’s conference call. Thank you for participating. You may now disconnect.