Good morning, and welcome to Tradeweb's Fourth Quarter 2023 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 Treasury, FP&A and Investor Relations, Ashley Serrao. Please go ahead.

Thank you, and good morning. Joining me today for the call are CEO, Billy Hult, who will review the highlights for the quarter and provide a brief business update. Our President, Tom Pluta, who will dive a little deeper into some growth initiatives; and our CFO, Sara Furber, who will review our financial results. We intend to use the website as a means of disclosing material, nonpublic information and complying with our disclosure obligations under 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 or 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, presentation and periodic reports filed with the SEC. In addition, on today's call, we will reference certain non-GAAP measures as well as certain market and industry data. Information regarding these non-GAAP measures, including reconciliations to GAAP measures is in our earnings release and presentation. Information regarding market and industry data, including sources is in our earnings presentation. Now let me turn the call over to Billy.

Thanks, Ashley. Good morning, everyone, and thank you for joining our fourth quarter earnings call. I am extremely proud of our Tradeweb team that generated the best revenue quarter in our history and again showcased the diversity of our revenue growth. We entered 2024 with strong momentum across our businesses. Many of you heard me in the past talk about the battle against the phone as a one-way train. And in many of our businesses, that train has a long way to go. While the secular tailwinds are powerful, we also need to be focused on making a difference in creating our own waves. Relationship building is a priority. And in the past year as CEO, I've stressed the importance of engaging regularly with our customers to understand how we can work together to move markets forward and improve their trading experience. Our customer skill sets are evolving as they continue to become more tech savvy and sophisticated and how they want to interact with the markets. We believe the world is moving towards a more algorithmic and multi-asset class ecosystem. This puts the spotlight directly on our one-stop shop value proposition in a good way, which we continue to take to the next level by investing in technology and adding and linking products in geographies. Diving into the fourth quarter, client activity and risk appetite continued to grow, which drove strong double-digit revenue growth. Specifically on Slide 4, record revenues of $370 million were up 26.3% year-over-year on a reported basis and 24.6% on a constant currency basis and adjusted EBITDA margins expanded by 15 basis points on a reported basis and 122 basis points on a constant currency basis relative to the fourth quarter of 2022. Turning to Slide 5. Rates and credit led the way, accounting for…

Thanks, Billy. Turning to Slide 9 for a closer look at credit. Strong double-digit revenue growth was driven by 31% and 46% year-over-year revenue growth across U.S. and European credit, respectively. Muni has produced high single-digit growth driven by a pickup in tax loss harvesting, while credit derivatives continued to see softer industry trends. Automation continued to surge with global credit AiEX average daily trades increasing 90% year-over-year. We achieved another fully electronic quarterly market share record across U.S. IG, helped by our highest quarterly IG block market share. Our institutional business continues to scale to new highs as we continue to provide our clients with a diverse set of protocols that meet their execution needs across a variety of market environments. Our primary focus on growing institutional RFQ continues to pay off with ABB growing 28% year-over-year with strong double-digit growth across both IG and high-yield. Overall, portfolio trading ADV rose over 40% year-over-year, led by growth across U.S. and European PT. In the fourth quarter, we produced record ADV across IG portfolio trading. Our clients continue to get more sophisticated in their usage of PT with 75% of our PT volume done in comp, the highest percentage since the second quarter of 2022. Retail credit revenues were up over 20% year-over-year as financial advisers turn their focus towards more spread-based yielding products to complement buying of U.S. treasuries. All trade produced a record quarter with over $157 billion in volume. Our all-to-all volumes grew over 30% year-over-year while we also saw over 40% year-over-year growth in our dealer RFQ offering. The team continues to be focused on broadening out our network and increasing the number of responses on the all trade platform. In the fourth quarter, the number of all-to-all responders rose by over 20% and responses increased…

Thanks, Tom, and good morning. As I go through the numbers, all comparisons will be to the prior year period, unless otherwise noted. Slide 13 provides a summary of our quarterly earnings performance. As Billy recapped earlier, this quarter, we saw record revenues of $370 million that were up 26.3% year-over-year on a reported basis and 24.6% on a constant currency basis. Specifically, we derived approximately 37% of our fourth quarter 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 35% and total trading revenues increased by 27%. Total fixed revenues related to our 4 major asset classes were up 7% on a reported and 5.5% on a constant currency basis. Rates fixed revenue growth was driven by the addition of new dealers across our mortgage specified pools platform and our U.S. treasury streams and CLOB protocols. Credit fixed revenue growth was driven by the previously disclosed dealer fee increases, which we instituted at the start of the fourth quarter. And other trading revenues were down 6%. As a reminder, this line fluctuates as it reflects revenues tied to periodic technology enhancements performed for our retail clients. Full year 2023 adjusted EBITDA margin of 52.4% increased by 49 basis points on a reported basis and 100 basis points on a constant currency basis from the full year 2022. Moving on to fees per million on Slide 14 and a highlight of the key trends for the quarter. You can see Slide 20 of the earnings presentation for additional detail regarding our fee per million performance this quarter. Overall, our blended fees per million decreased 15% year-over-year, primarily due to a shift away from cash rates and a decrease in cash credit…

Thanks, Sara. As I embark on my 24th year at Tradeweb and my second year as CEO, we continue to see ample opportunity to grow our One Tradeweb mantra and build better markets for the future. We are focused on ensuring our D&A continues to evolve as we remain in the catbird seat as we look to innovate and find new ways to modernize the fixed income markets. Innovation, collaboration and transformation are at the core of our DNA, and I continue to be excited about the road ahead. On that note, we reported strong January volumes yesterday which translated into revenue growth in January in excess of 20% year-over-year. I would like to conclude my remarks by thanking our clients for their business and partnership in the quarter, and I want to thank my colleagues for their efforts that contributed to our record quarterly volumes and revenues at Tradeweb. With that, I will turn it back to Ashley for your questions.

Thanks, Billy. [Operator Instructions] Operator, you can now take our first question.

[Operator Instructions] Our first question will be coming from Christopher Allen of Citi.

I wanted to ask about the r8fin deal, which I think has gone a little bit under the radar. I wonder if you could touch on what the opportunity set is from offering this technology to the institutional clients. Is there any cross-sell opportunity to Redfin's or relative value client base? How is the offering from an EMS perspective and rate futures complement or enhance Tradeweb's current rates offering?

Sure. Chris, it's Billy. Thanks for the question. Good to hear your voice. Maybe let me start for a quick second with putting a little bit of a frame on a good question. So starting with, I think it's a good time to be in the rates business. I think it's actually a better time to place a really smart bet in the rates business. I love the idea conceptually of Tradeweb investing into our strength. I think that's a really important concept. So I would kind of start with that. If you think about our government bond franchise for a second in terms of the leadership position that we have, obviously, record market share, Chris versus Bloomberg on the long-dated part of the government bond market. In the fourth quarter, our market share is now over 20% on an overall basis, record institutional volumes in January. So a real kind of like position of strength for us. Macro environment like sets up really well, again, to kind of like push these bets into our core strength. So when I think about the macro environment, we think about the concept, obviously, of like, we're in a real rate, 10-year notes above 4%. Maybe it's going to 4.75%. Maybe it's going to 3.50%. That's what sort of makes the market, and we love those kinds of thoughts that are entering in about this like real kind of real rate environment. The debt market is growing. The central banks are not the buyers in the market. So from our perspective, that means that the sort of private sector piece of the market are now the real intermediaries. And so that's a really good environment for us. So when we think about r8fin, obviously, like two big things. One is electronifying high-touch flow,…

Our next question will be coming from Ben Budish of Barclays.

Billy, I was wondering if you could talk a little bit more about your international expansion plans for the next few years. Now that you've completed Yieldbroker, you alluded in the prepared remarks to sort of digging into a little bit more into Asia. Can you maybe talk a little bit tactically, how does that work from Australia to maybe the rest of the continent? And for some context, could you perhaps give just a little bit of an overview of the current exposure? Where are the key customers? What are the primary products? And where does that grow from here?

As it's a good question. So let's start with it this way for a second for us, like very straightforward. It's like always about the clients, right? It's like always, always about the clients. So our clients are global, right? So that's always formed our sort of decision-making matrix in terms of where we're going, right? So the formula, the cadence has always been how do we take advantage of this like very strong appetite that exists out there for the demand for U.S. products, right? And from there, it's always been okay now let's build out our presence in these local markets. So it's like U.S. government to European governments, dollar swaps to European swaps, U.S. credit to kind of European credit. So that's always been our formula or cadence of how we think about things because we're always building things around the client experience. Quick shout out, which I do once in a while, just -- Enrico Bruni is our Head of European and Asian business. He's done a great job. The team has been instrumental. They've been driving an average. I think it is of 15% revenue growth in our international business over the last five years. So we think about the business then kind of like in a straightforward way, two ways, I would say, growing the European APAC part of the world, which has been our historical focus. And then sort of two, and it's like a big two, which would be sort of competing and really driving a business for us kind of like in the EM region. I think that formula has worked very well for us. So fourth quarter revenues, we're up over 30% year-over-year across these products. In Asia, we're growing our presence across ETFs, swaps, government bonds, there we're becoming…

Our next question will be coming from Alexander Blostein from Goldman Sachs.

Lots of discussion on the call around just prospects of longer duration, and I appreciate the extra disclosure you guys put out in the deck around the swap business is definitely pretty helpful. But when you use amount a little bit, can you help frame the fee per million opportunity broadly across the business if duration starts to expand?

Sure, Alex. It's Sara. Nice to hear from you. And it's a great question, and I'm glad you like the extra slides. We thought that they would be helpful. Let me frame it just with a little bit of context because when we're talking about fee per million I've made this point on a couple of calls. The impact on fee per million is mostly driven by business mix, right? So what businesses were doing volume in protocol, product mix, but also to a lesser impact duration, which is really your question, so I'll kind of focus on that. The two main business areas when you think about our portfolio where duration has the biggest impact across revenue and fee per million are largely swaps and investment-grade credit. And the reason for this, I know you know this, but just to kind of state it for everyone's benefit, we charge based on actual risk being created in both of those areas. So DV01, PD01, it's not charged on a notional volume basis. And as we kind of talked about in the prepared remarks, clients have definitely been doing more trading on the short end and duration in our businesses has been decreasing, particularly in swaps. And so if you think about the impact of duration, if you -- and this is a perfect world, if you try to hold everything constant, everything else being equal and just limit the impact of duration to give you a flavor, I would say in dollar swaps, a one-year extension in duration from, call it, 10 to 11 years can increase that risk being treated by 7% or 8%, which obviously has a knock-on impact on revenue, all else being equal. In credit, the same sort of one-year extension in maturity could increase institutional IG credit fee per million by 8% to 9%. So that gives you a little bit of a continuum of the impact. Probably also worth mentioning that in terms of things that move duration, it's also impacted by the level of absolute rates. And so maybe another way to kind of think about the model and kind of putting these together gets you a really nice opportunity. But if rates were to fall by 100 basis points across the curve, that same concept of the risk being created in a 10-year dollar swap could rise by another 5% or 6%. And on the IG side, another 5%. So there are a couple of different variables. Business mix always being the biggest, but hopefully, that gives you a little bit of context as to how to model or think about the opportunity for duration.

Our next question will be coming from Craig Siegenthaler of Bank of America.

This is Elias Abboud from Craig's team. It looks like the RFM protocol in swaps is breaking out. It looks like volumes there have tripled since 2021. What makes this protocol a great fit for swaps? And have you guys evaluated maybe rolling it out in other asset classes?

It's Tom, and thanks for the question. Yes, the RFM protocol or request for market has gained a lot of popularity and swaps, particularly in emerging markets but also in developed market swaps. Just to remind people who may not know, this is where rather than asking a one-sided price in an RFQ, you ask for a 2A price. The primary benefit to a customer and receiving a 2A price is to minimize information leakage to the market, not signaling the direction that they want to trade. So in markets where you have 2A streams, continuous markets, for example, U.S. treasuries, there's no real need or demand for RFM, but in less liquid markets or trades where there's a larger price impact like swaps compared to cash bonds or EM generally compared to DM or larger trades compared to smaller trades, there is a benefit. For that reason, it has picked up as a protocol, particularly in EM. There's also a benefit for dealers in avoiding what we call the winner's curse, right? So if a whole bunch of dealers get asked the price and they know the direction, when you win that trade, you got to be more cognizant of how you manage that exiting that trade, particularly in less liquid market. So we have been expanding the protocol as we see the demand from clients and dealers to support the protocol. For example, list trading and swaps is moving more towards RFM. So we do think that RFM can expand to other products, yes, but we do so in a very thoughtful way. And when we see both demand on the client side and support from dealers to maximize the impact on the likelihood of success.

Our next question will be coming from Michael Cyprys of Morgan Stanley.

Just a question on ETFs. We've seen meaningful growth across the industry, particularly fixed income ETFs over the last couple of years. And you expect ETFs to be a beneficiary of a potential fixed income rotation. So can you just talk about how this is impacting your business and how you see this impacting market structure more broadly as fixed income ETFs continue to grow and how do you think about best monetizing the opportunity set here? Maybe talk about some of the steps you're taking here in '24.

Yes. Michael, it's Billy. Thanks for the question. And I think ETFs is like absolutely the right time to sort of ask a question like that, so thank you. You know us very well. But from my perspective, a little bit of like -- our story has always been about like what I would describe as expansion, right? So it's sort of vertical across client channels and then horizontal across products and geographies, right? And so I wouldn't say it was necessarily like the elevator pitch when we went public. But when we were going public, Tradeweb was very well known as a rates trading platform kind of period. And in 2023, the reality is that almost half, I think it's like -- I think it's actually 48% of our revenues now come from non-rates businesses and 40% of that growth has come from non-rate businesses in 2023, right? That's like a big number, right? So our investment and our execution in ETFs is like a huge piece of that story. It's like not that we couldn't spell ETFs in 2016. Obviously, like an E and T and an F. But we didn't have like unbelievable domain knowledge and expertise in 2016. I think we sense the opportunity, and I think we were viewed as the correct kind of industry partner around building a business there, and I give our team a lot of credit for figuring all that out. So now what we're seeing is like this -- what I would describe as almost like an expansion of sophisticated market participants obviously, including ETF market makers that are investing heavily to challenge what I would describe as the traditional manual kind of trading conventions. And my instinct is this push is sort of like this one-way train kind of thing, right? Market participants are now using -- have multiple pricing sources, modeling techniques and market indicators to derive essentially a more accurate and up-to-date pricing on a bond, right? So we kind of understand all of that stuff. I would say the leading ETF player expects fixed income ETF AUM to triple by 2030, right? These are like big one-way market trends now that we feel, I think, proud to be a big part of. We're going to monetize this all in a very straightforward way for our institutional ETF business globally that's doing really well. And then I would kind of remind you for a quick second, just the nature of how important these ETF market makers are in terms of credit market making in our sort of day-to-day operations of our credit business and we feel really good that we're monetizing that piece of the market as well. They are fundamentally important and strong players for us on the credit side. So it's feeling really good about how we've gotten here with ETFs and kind of where we're going. I think the credit piece of it is a really big one.

Our next question will be coming from Patrick Moley of Piper Sandler.

I was hoping that you could share some more details on the opportunity and time line to monetize the closing auction pricing data how your relationship with FTSE benefits the strategy there? And then any color you can give us on how to size the TAM there would be very helpful as well.

Patrick, it's Billy. Real quick -- congratulations on like two things. First, asking a straightforward question coming from HyperCamera on the heels of our friend, Mr. Repetto. And two congratulations because we definitely heard you had had a baby, it's the best in the world. So congratulations from the Tradeweb team. And thanks for a really good question. It's interesting, right? You're talking about like trade at close, you're asking you questions about trade at close. And my brain is going a little bit to the complexity of, for example, like the government bond market. The first question was about r8fin and about how these sort of macro hedge funds are engaging in liquidity through smart algorithms in r8fin then. And this is almost like the other side of the coin in the government bond market, right? The thread is obviously all about like innovation and efficiency. But the other side of the coin are these, obviously, these large, large asset managers that track the benchmark that now we're looking for what we would describe as moments in time where they need liquidity. And so I mentioned the concept before that it's all about the client. It's all about the client understanding those clients' needs. And so that's how we've built the protocols for us around trade at close. Clients are now leveraging list trading tools where we provide valuable kind of what we would describe as like post-trade data where they are filled relative to our reference prices. It's pretty straightforward that works exceptionally well at the end of the month, some of our biggest, most important clients are accessing that protocol now through us. We currently have an official closing price on treasuries, U.K. gilts, European government bonds, where FTSE is our third-party administrator not to hand you a brick, Sara, but if you have a little more comments on our FTSE relationship and where we're going kind of around that pricing.

Sure. I can jump in there and congrats, Patrick, as Gilead mentioned. On the FTSE side, I would just say, look, in order to have a trusted and valued benchmark, we need and we look to partner with third-party administrators that validate that methodology. And we have a really strong and good relationship with BPCI. It makes sense to continue to partner with them. I think as Billy referenced, we have a track record of working with them on the U.S. Treasury U.K. and European government bonds. And as we think about going forward, we see the expansion of that relationship across new benchmark products. So there's things that we're working on adding bid-ask information to the mids that we already use in products. We have muni AI pricing potential becoming a benchmark. So there are a number of other benchmarks in the works with a partner we already have had a good track record with. Probably worth noting, establishing a benchmark doesn't happen overnight. So the revenue and sales cycle for this can take some time. But certainly, we see a lot of opportunity here. And we've already realized and continue to realize strong growth in our third-party proprietary data products, and this is just going to be enhancing through that.

Our next question will be coming from Dan Fannon of Jefferies.

Question is on high-yield. Maybe if you could talk about the current kind of market backdrop. And as you think about your market share and opportunity within that, is there anything structural that does limit your ability to grow that the way that you have in, say, the investment-grade market?

Dan, so we have made steady gains in recent years in our IG market share for sure. And our progress in high yield has been slower or a little bit more uneven. But there are no structural impediments with making more significant gains. One thing to note, high yield doesn't trade on spread. So therefore, the competitive advantage that we have in net spotting and net hedging isn't a factor here as it is in IG. And additionally, because high yield is less liquid, clients tend to use all-to-all more where we are focused on narrowing the gap in our responder network. So what have we been doing in high yield a number of things? We've been investing in our client network, and we've been making good inroads in adding significant clients to that network that were absent in the past. So I'm optimistic about our progress on adding large clients in '24 that hadn't been there in the past, which will help boost high-yield results. Additionally, we've been hiring credit salespeople. We hired in '23, we are hiring more in 2024, and that will continue to move the needle in expanding our client network and delivering more from our existing clients. The third area of focus is expanding the responders on the platform, and we've seen very strong growth in responders and responses. For example, in high-yield, our anonymous responses were up 30% year-over-year. So we're making gains there. And I guess the final thing I would point to is the Aladdin partnership, which should help level the playing field for us in high-yield as this comes further online in 2024, we made good progress there. We're working through the integration with Aladdin in 3 phases. Phase 1 completed last year that was focused on getting dealer access and inventory data into Aladdin. Phase 2, we also recently completed and that allows Aladdin clients to respond all-to-all inquiries right on the Aladdin dashboard. And in Phase 3, clients will be able to initiate an RFQ on Tradeweb right from within Aladdin and then also use our automation tools. So those Phase 2 and Phase 3, we expect to be complete over the next 12 months and with all the investments, we expect to see continued progress. So while the progress in high yield has been more limited, we do have a multi-faceted plan that we are executing on and which we're optimistic will yield results going forward.

And our next question will be coming from Andrew Bond of Rosenblatt Securities.

Tradeweb is early and innovative in portfolio trading relative to market access and others that didn't really see the same growth opportunity that continues to play out today. That said, given it continues to be one of the primary drivers of credit volume growth competitors are taking it more seriously. I think the protocol was mentioned more than 30 times on their last call last week, and they're about market access is investing more heavily to try to win share. So just given the heightened competition, how do you feel about your positioning and the moat around your offering and any potential to utilize portfolio trading in other parts of your business.

Andrew, so yes, portfolio trading continues to be a huge success story and growth area for us. We had -- as you read and as you heard, we had record PT volumes in the fourth quarter and in January, achieved another monthly record with over $60 billion in portfolio trading volume. We're also optimistic about the growth of PT as a market protocol, as you pointed out, a lot of the growth in the market is from PT, and we do expect PT share of the market to continue to grow given the efficiencies that it provides for clients. And remember, a lot of the gain in share is still coming from the phone. So we think that overall part of the market will grow. As far as competition, we fully expect our peers to compete and to innovate. And overall, that's good for clients as the market gets more efficient and moves forward. But you asked about our moat, we do think we have a competitive moat that is strong, led by our ability to connect our leading U.S. treasury business and provide net spotting to clients. It starts right there, and that's something that saves millions for our clients. Additionally, we continue to leverage our first-mover advantage by constantly iterating on and improving the functionality that we have in PT. So I'll give a few examples. We are in the process of revamping our entire portfolio trading list infrastructure, and we're in the process of rolling it out right now. What does that do? That increases the speed of execution for clients. It provides greater capacity. Right now, we can accommodate portfolio trades of 2,400 line items. That capacity will grow significantly. And we're also going to be able to provide better client and dealer analytics. Second thing,…

And our next question will be coming from Alex Kramm of UBS.

I know it's late here. But just wanted to come back to, I think, the early part of the call. You proactively talked a lot about the cyclical outlook. And if I heard you correctly, you're actually pretty excited about what's in front of you on a cyclical perspective, so maybe you can just double-click on that. But more importantly, on the rate side, I think there's a prevailing view that as rates get cut, that's bad for rate volumes. I don't necessarily share that view, but would like to hear your thoughts on that. And maybe for Sara on that notion, do you think about rate cuts at all as you budget kind of like your revenues? Or do you think it's just like a negligible impact on trading revenues.

Yes. We think this is a good environment for us. And I kind of -- I laid out this kind of concept that I was saying before, which is like we're into like real rate now, right? And again, directionally, if we go from here to 5% or 3.5% or 3% like we're talking about now like real rates. I think the high-level concept of like debt is growing kind of period. And then this concept of, I think, in a significant way, the central bank is not playing that sort of counterparty role in the marketplace, I think, is a really kind of really important one. And so like we kind of cheer on the reality of sort of the private sector back as being the real kind of market risk intermediaries. We think that's good. We love the business model of BlackRock connecting with Goldman or PIMCO connecting with JPMorgan. We think that's like a great end result. The curve is getting steeper. I mean, to make an obvious point, everything has evolved differently than anyone sort of expected, so you never quite know exactly where you're going, but there's no question from our perspective that this is a sort of environment that we think plays very, very well for us. And as the sort of the stronger whispers or the stronger feelings that a rate cut was kind of in the works, you could see how our business performed exceptionally well in the second half of last year in that sort of anticipation of all of that steeper curve, all of these things kind of, I think, working in the right way for us from a macro perspective.

Yes. I mean I can translate that even a little bit. You obviously saw the really strong volumes we've put up in January. And that type of debate, that type of environment really does translate quite well. Probably no better place to see than in our swaps business where we're seeing revenue growth excess of 40% in January. So it's one month, but it does give you a sense of that environment, that type of place where we're able to add value for clients and kind of how it translates into the business.

And our next question will be coming from Kyle Voigt of KBW.

Maybe just a question for Sara on the margin commentary and expecting less margin expansion in '24 versus '23. Just given the start to the year that you've seen, it seems difficult to get the numbers to work out to lower margin expansion that you saw in 2023, even towards the higher end of the expense guidance range. So I'm just wondering if you kind of help frame where you'd expect expenses to come in relative to that guidance range you laid out, if we see revenue growth for the full year persist at similar levels to January's 20% rate. And are there scenarios where you'd expect to come in above the high end or below the low end of the range, depending on the revenue environment?

Got it, Kyle, thanks for the question. Look, we put some thought into this range. Just kind of a reiteration to everyone's benefit. At the midpoint of the range, we're talking about 12% expense growth, which includes the acquisitions that now are closed. Excluding the acquisitions, that midpoint is about 10%, which is pretty much in line if you looked at any sort of track record of the expense growth we've put up historically. When you think about how we think about margin expansion, there's really been no change in our philosophy there. We're constantly trying to balance investment through the cycle to make sure that we feel like we are putting the right bets on the table to invest in durable revenue growth. And I think 2023, if I were to play back the year, is kind of like that's the proof in the pudding. We had an environment in the first part of the year where the revenue environment was more challenging for a lot of macro reasons. We were able to deliver margin expansion in that environment. And then, equally as importantly, particularly towards the back half of the year when the environment really became much more favorable and we were seeing very strong revenues in line with kind of what you're seeing for January, you saw us also be able to accelerate some of those investments. And so still delivering margin expansion, but obviously, pacing expense growth in line with revenues. This is an environment that we like. Billy just talked about it. This is an environment that we want to invest in through the long term. We do care about margin expansion. We talked, I think, in the prepared remarks about delivering expansion, we're comfortable on either end of that guidance, but kind of cherry picking exactly where you land. It's a combination of sort of what's the environment and where things land. And obviously, if you look at any trend we've talked about, as revenues grow, our expenses grow. We have performance incentive compensation. We have variable fees, which is about 30% and so those correlate with revenue. So generally, as revenue environment improves, you're going to see us have expenses that kind of trend in that direction, too. Hopefully, that gives you a little bit of color. But obviously, we have the acquisitions, too, which we could spend time on either now or later. But big picture, does that help give you a frame?

Yes, it's good.

Thank you. And that concludes today's Q&A session. I would like to turn the call back over to Billy Hult for closing remarks. Please go ahead.

Everyone, thank you very much for joining us this morning. If you have any follow-up questions, obviously, feel free to reach out to Ashley, Samir and the team. Everyone, have a great day, and thank you so much for your time.

This concludes today's conference. You may all disconnect.