Good morning, and welcome to Tradeweb's First Quarter 2024 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 our 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 or 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 first quarter earnings call. This was another record quarter as our strategy and focus on building deeper relationships with our clients through our one-stop shop offering continues to pay off. I believe it's a great time to be in the fixed income trading business. Macro debate is flourishing and electronification continues to take hold, leaving me optimistic about our future. Even as there is consensus around rate cuts in the U.S., questions remain on the number of cuts this year, ultimate level of rates and the shape of the yield curve. In fact, Jamie Dimon in his most recent annual letter highlighted the potential for U.S. rates to range from as low as 2% to as high as 8%. Traders can make a lot of money with that sort of spread. While capitalizing on the array of organic growth opportunities in front of us remains our focus, we also continue to selectively use M&A to complement our offerings with the goal to create better outcomes for our clients. This year, we have deepened our penetration into the U.S. Treasury market and added new futures and algorithmic functionality with r8fin and are adding corporates as a fourth client channel with our pending ICD acquisition. Diving into the first quarter. The momentum we saw in January persisted into February and March as we eclipsed $400 million in quarterly revenue for the first time. Specifically, strong client activity, share gains and improved risk appetite drove 24.1% year-over-year revenue growth on a reported basis. We continue to balance investing for growth and profitability as adjusted EBITDA margins expanded by 141 basis points relative to the first quarter of 2023. Turning to Slide 5. Rates and credit led the way, accounting for 55% and…

Thanks, Billy. Turning to Slide 7 for a closer look at another record-breaking quarter for credit. Strong double-digit revenue growth was driven by 37% and 46% year-over-year revenue growth across U.S. and European credit, respectively. Munis produced mid-single-digit growth, while credit derivatives revenues were more muted given softer industry volumes. Automation continued to surge with Global Credit AiEX average daily trades increasing by about 70% and year-over-year. We set another fully electronic quarterly market share record in U.S. IG helped by record IG block market share. Our institutional business continues to scale to new highs as clients engage with our diverse set of protocols to optimize execution across a variety of market environments. Our primary focus on growing institutional RFQ continues to pay off with ADV growing 29% year-over-year, with strong double-digit growth across both IG and high yield. Moreover, portfolio trading ADV rose over 70% year-over-year with IG portfolio trading reaching record levels. Our clients continue to get more sophisticated in their usage of PT with 65% of our PT volume done in comp. Fees income volumes grew 85% year-over-year. Retail credit revenues were up almost 40% year-over-year as financial advisers have started to turn their focus towards credit in recent months to complement their buying of U.S. treasuries. All trade produced a record quarter with over $200 billion in volume. Specifically, our all-to-all volumes grew over 15% year-over-year and our dealer RFQ offering grew almost 40% year-over-year. The team continues to be focused on broadening out our network and increasing the number of responses on the all trade platform. In the first quarter, the average number of responses per all-to-all inquiry rose by over 45% a year. We also continued to increase our engagement and wallet share with ETF market makers. Finally, our session ADV grew over 65%…

Thanks, Tom, and good morning. As I go through the numbers, all comparisons will be to the prior year period, unless otherwise noted. Slide 9 provides a summary of our quarterly earnings performance. As Billy recapped earlier, this quarter, we saw revenues of $409 million that were up 24.1% year-over-year on a reported basis and 23.8% on a constant currency basis. Stepping back, looking at revenue this quarter, we generated similar average daily revenue growth with March being the strongest across all 3 months. We derived approximately 38% of our first 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 30% and total trading revenues increased by 24%. Total fixed revenues related to our 4 major asset classes were up 7.3% on a reported and 6.9% on a constant currency basis. The fixed subscription fee increase was primarily driven by the addition of new dealers and customers to the REITs platform as well as pricing increases on some of our rates subscription services. Credit fixed revenue growth was driven by the previously disclosed dealer fee increases, which we instituted at the start of the third quarter of 2023, and other trading revenues were down 5%. As a reminder, this line fluctuates as it reflects revenues tied to periodic technology enhancements performed for our retail clients. This quarter's adjusted EBITDA margin of 53.7% increased by 128 basis points on a reported basis when compared to the 2023 full year margins. Moving on to fees per million on Slide 10 and a highlight of the key trends for the quarter. You can see Slide 16 of the earnings presentation for additional detail regarding our fee per million performance this quarter. For cash…

Thanks, Sara. We have always recognized that we occupy a very important piece of desktop real estate connecting liquidity providers to their most important clients. The markets we live and breathe in remain dynamic, and we continue to work very hard alongside our clients to innovate and push the boundaries of what can be traded electronically. Our sales and tech teams remain busy, and strategically, I feel good about the road ahead and durability of our one-stop shop value proposition. With a couple of important month-end trading days left in April, which tend to be strongest revenue days, overall revenue growth is trending in excess of 40% relative to April 2023 driven in part by favorable year-over-year comparison due to a temporary risk off environment fueled by the regional banking crisis in the prior year period. Revenue growth this month is also being helped by a few more trading days. Focusing on average daily revenue, we are trending close to the first quarter as momentum in the business continues. The diversity of our growth remains a theme. We are seeing strong volume growth across global government bonds, mortgages, interest rate swaps, corporate credit and repos. Our IG and high-yield share are both higher than March levels with IG currently at record levels. As we focus on our future, we recently expanded our executive leadership team, adding Ashley Serrao, who you all know well; and Mike Cohen, our Global Head of Marketing and Communications. With these leaders have made a significant impact on our company, and we look forward to their future contributions. I would also like to welcome Lisa Opoku to our Board of Directors, who joined our Board as of March 7. Lisa brings nearly 30 years of finance and legal experience to the Board, while also increasing our Board's independence and diversity. We look forward to benefiting from her valuable insight and industry experience. Finally 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 revenues at Tradeweb. With that, I will turn it back to Ashley for your questions.

Thanks, Billy. As a reminder, please limit yourself to 1 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.

[Operator Instructions]. Our first question comes from the line of Alexander Blostein with Goldman Sachs.

Great to see diversity in the business and the growth, but I wanted to zone in on the interest rate swap business, which continues to be obviously quite active here. And I guess the growth is not all sort of coming from compression trading as maybe we've seen over the last couple of quarters. So help us maybe unpack a little bit the key drivers of recent growth and how you're thinking about this business for the rest of the year from here?

Alex, how are you? Happy spring, and thanks for the question. Alex, if we were going to -- Alex, I'd like to always start with a little bit of a half a step back, as you know, if we were going to sort of paint the picture on, from our perspective, not just on how to really build a business but really grow it and become the leader in the business. From our perspective, I really feel like the swaps business would paint a pretty good picture for us. It would be plant to flag early in a large opaque, nontransparent market when regulation starts moving in that direction. Don't be a bystander, really work with the regulators and shape that regulation in a way that works for the most important clients and then leverage the network. And I kind of say that very strongly leverage the network. And so the advantage for us, as you know, in swaps, has always been this giant network of mortgage customers who are huge consumers of swaps that we have, very strong network of U.S. government and European government clients. Particularly on the hedge fund side, we're very active in the swaps market, to leverage that network. And then continue to invest and innovate, invest in regions. So a lot of the investments that we have put into place around EM has paid off for us, Alex, and then work with clients and innovate on what we describe as micro trading protocols. So from our perspective, the protocol request for market has been a market share driver and a big driver of revenue. So those 2 factors alone are responsible for 50% of our revenue growth over the past 2 years, we've gone from basically making $220 million in our global swaps business in '21 to $300 million in '23 and feeling really good where the trajectory of that business is going in '24. So a lot of enthusiasm for us. We see a lot of potentia, we quote the big stat that 70% of the swaps business is still done via voice markets. We see that as large size trades. We see that as partly the wholesale market where we still have a big area of focus there. And we're still early in the penetration of electronic solutions across EM, I think inflation swaps, swaptions and then how we describe multi-asset packages. So we're going to keep our focus. It's been a big business for us over the past few years and it's a story that we're going to continue to tell very strongly because I think it paints a very strong picture about how we've arrived in a leadership position in that space. And thanks for the question, Alex.

Our next question comes from the line of Patrick Moley with Piper Sandler.

So you've made a number of value-add bolt-on acquisitions in recent years, ICD may be a little larger than the others. But I was just hoping to get your updated thoughts on how we should think about the M&A strategy going forward? And then if I could just add a second piece to that, ICD obviously adds an entirely new client segment in corporates. So could you just tell how that might impact your approach to evaluating potential targets in the future?

Thanks for the question. I don't want to say we have our hands full right now, maybe not quite the perfect way to describe it, but we're focused with a capital that focused really on 2 things. It's maximizing our organic growth potential first and foremost. And then the value of our recent acquisitions, and I think you framed it really well. This is -- we announced 3 deals in the past year. The good news from our perspective is our growth is really kind of firing on all cylinders. And both rate then and yield broker are, from our perspective, progressing very, very well. And I say this in a strong way very much looking forward to ICD being part of the Tradeweb family. Feeling very, very good about the strategy there and our ability to integrate going forward. Longer-term view, it's always important for the company to continue to place these bets on the table, improving the client experience. Increasing our earnings power. These are kind of blueprints for us. And so with respect to future deals, we're going to continue to evaluate expansion areas for growth across geographies, clients and products, and that's become our playbook. I'm going to kick it to Sara for some important details. And we lead always with the concept of how important it is for the culture to fit us. And that is one of the reasons why we feel good about the acquisitions over the past year and particularly around our recent one, we feel there's a very, very strong cultural fit there, which we still use a lot.

Great. I mean I think you covered it really well. I would say just emphasizing what Billy said, the framework doesn't change, obviously, looking at strategic fit and disciplined financial fit discipline and then also going to be measured in terms of operationally, making sure that we have the bandwidth and are digesting. That said, ICD, once it closes, does open a new client channel for us. And obviously, we're focused on that integration. What we think we're going to use all our tools in the toolkit ultimately grow our overall platform, and that will be organic and inorganic. And we do think overall corporate treasurers is an underserved market. So we like the long-term ability to layer on different pieces of the puzzle there. I would say just one other thing we've talked a lot about acquisitions. I would say when we think about inorganic, we do think about the range of tools in the toolkit. And so we do look at partnerships, we do look for smaller investments. And one area that didn't actually conflict in terms of integration and operational bandwidth, we are spending more time just researching emerging technologies, much smaller financial commitments in that space that we want to look at to make sure that we're building out a platform across the full suite of things in term of where market goes. So thanks for the question, and good to hear from you.

Thank you. One moment for our next question, please. Our next question comes from the line of Andrew Bond with Rosenblatt Securities.

So in the last call you talked a bit about the pace of margin expansion moderating from here. Sara, you talked a little bit about that in your prepared remarks today. So can you frame what kind of margin expansion opportunity you still see for the company over time given your current growth rates? And maybe what do you see as Tradeweb steady state for EBITDA margin?

Great. Andrew, nice to hear from you. Obviously, like -- and I've talked about this, we feel like our business is still growing and our platform is still growing. We are confident we can grow margins form here. Given that many of our businesses are still scaling, where we are on that spectrum, I think it's too early to really quote or determine what the steady-state margin opportunity is. Our focus right now, particularly in the environment that we're in, is around entering new markets, expanding the platform and investing in new opportunities. And I think the great news is we see a lot of interesting opportunities to accelerate our investment, which we talked about and really drive durable, profitable revenue growth over the long term. So you've seen us when we've talked about investing in areas like EM, more on credit sales as we have momentum there. Automation, although there's a lot of organic opportunities, but you've also seen us deploy capital for acquisitions, and we're going to continue to put investment dollars behind those whether it be yield worker ultimately the ICD or rates in which we think we can leverage that technology in other markets. So I think -- I know everybody wants like a very specific number, but I just think it's -- the good news is it's too early. I think our business really is on that growth horizon for several years to come. What I can be clear about, and I think you've seen us do have a good track record here is while we're focused on all these areas of investment, we care about profitability. And so you should expect us to grow margins slowly and steadily and have them trend higher, particularly as we look around making decisions, these are decisions that we all think add to the margin expectation over time. And then lastly, I've talked about this, even in an environment that can be more volatile, and we have a lot of control over our expense base. And so a fair bit of discretion and variable expenses. So that allows us to kind of have that extra bit of confidence around delivering for our shareholders.

One moment for your next question. Our next question comes from the line of Chris Allen with Citi.

I wanted to circle back on interest rate swaps and compression activity specifically. Maybe if you could just provide some color on what kind of customers are coming in for compression trading, customers that are just coming in from compression trading. Are you making any progress on broadening out the wallet of those customers to capture risk trades? And kind of where are you with that progress?

Hi, Chris. Good to hear from you, it's Tom. So yes, compression trading kind of ebbs and flows during the normal course of business, clients put risk on and then they manage out old risk through compressions and both clients and dealers find it a very efficient tool to reduce derivative notional balances. The biggest players are the macro hedge funds, and they can drive large amounts of the volume. So they continue to be big drivers. We have been broadening out and increasing the number of participants in the compression protocols. So it's all been a very positive story. Now to your question about how that relates to risk trading, what we've learned is that our most active compression clients become very sticky to platform, and they've also been significantly growing their volumes of risk trades with us, which are, as you know, more profitable. Last quarter, we did have some charts in the investor presentation have highlighted this powerful correlation as well. And the key takeaways from that are that our -- in the chart last time, our top 5 to 10 compression clients have not only had very significant growth in compression volumes but also very large growth in their risk trading volumes as well. So those clients moved up very significantly in the rankings with us in risk trading. So we think that compression continues to be a very useful tool and very complementary and additive protocol to our overall swaps business.

One moment for our next question. Our next question comes from the line of Kyle Voigt with KBW.

So you called out adoption of RFQ trading as being a key driver of credit volume growth in the quarter and in March specifically. And I think in the prepared remarks, you noted success on both the institutional RFQ and dealer RFQ side. Just more broadly speaking, just wondering if you could talk about why you're having success with that RFQ protocol right now? What is resonating with these end clients across both institutional and dealer segments? Is it price, capabilities or something else driving the outsized growth on the platform.

Yes. Kyle, it's Billy. It's a good question. Because as you know really well, it sometimes feels like when you talk about credit, it's like the world gets divided between portfolio trading and all-to-all trading. And those kind of pick up the kind of big headlines, but those are kind of headlines sometimes. And we feel like RFQ trading is really in a pretty straightforward way our biggest tangible opportunity in credit right now, right? It's a foundational protocol that you have to get really right to be in the flow of things. So that's like a huge, huge area of focus for us. And so when we think about that RFQ world, we think about, first and foremost, the institutional side where we've been going to grow volumes there really now for years, as our network expands and our efforts to kind of cross-sell pay off. I say this in a pretty simple way. We're building deeper and stronger relationships with our clients. And part of that has been, from our perspective, getting things right, adding value around portfolio trading, adding value around the all-to-all network. And then sometimes what happens in a very straightforward way is, then you wind up getting that RFQ volume. It's like you've kind of earned that type of business, and that's been a big growth -- area of growth for us. Dealer RFQ, which is a sort of change in market structure is a more recent initiative for us. So still in early stages of building that protocol. But we feel, given the relationships we have with the dealers, with the banks that the momentum there is quite promising. So answer to your question for a second on some numbers, RFQ activity increased almost 30% for us, dealer RFQ almost 40% in the first quarter. So we're getting really into some big numbers. And on the -- a little bit technically on the RFQ side, we continue to sort of make the investments and the enhancements that you would expect us to make some of those quite spoke for specific clients, it continues to kind of resonate with the broader market. It's a big area of investment for us, huge growth potential. And I kind of emphasize this point to you, you start to get some of that after you've added some of these efficiencies that we've talked a lot about in terms of portfolio trading and rounding out our liquidity and all-to-all trading, then all of a sudden, you start to get some real kind of momentum in terms of the client activity. So thanks very much, Kyle, for your question. Appreciated.

Our next question comes from the line of Vincent Mendez with Barclays.

Maybe I think circling back, I think with Patrick's question on M&A. Just can you maybe give an update on r8fin, you've owned the asset for about a quarter now. Any updated thoughts on what Tradeweb can do to sort of accelerate that business? What was sort of the potential upside from now having access to that futures trading workflow, having had a little bit more time owning the asset?

So it's Billy, as Sara mentioned, we remain very excited about this asset and the opportunity for growth, which nicely complements our existing businesses. As mentioned in the prepared remarks, the acquisition is off to a very strong start and already contributing about 1.5 percentage points to our U.S. Treasury market share. So that's very significant volumes starting day 1. Over the last quarter, we spent a lot of time engaging with the r8fin client base, working on full integration into the Tradeweb infrastructure and our focus ahead will be on onboarding more Tradeweb clients to r8fin, which will add to an already very rapid pace of client growth that existed before we got involved. So there's a lot of momentum on the client side. And the feedback that we're getting from existing clients and prospective clients is extremely positive. We now have a market-leading technology offering that's allowing us to capitalize on growing demand for intelligent execution of multi-legged orders across cash treasuries and treasury futures. This access to U.S. bond futures isn't a complement to the rest of r8 products. I think you heard us talking about finding ways to get involved in that space. And now we are. As far as what's ahead to your question there, looking forward, there is a lot of excitement outside of the U.S. on this acquisition as well, and our plans include expanding into new markets with European cash and futures and potentially swaps likely next on the agenda. So we see growth in the U.S. with the existing products and international expansion coming in the relatively near future. Thanks for the question.

Our next question comes from the line of Michael Cyprys with Morgan Stanley.

Just wanted to circle back on the Aladdin integration for the credit business. I was hoping you can update us on the progress there. Maybe just remind us what exactly is going to be changing in terms of what customers will have access to that they didn't have access to previously. And how do you think about the opportunity set? And if there's any sort of lessons learned from the integration on the rate side that occurred years ago, if I'm not mistaken.

Sure, I'll take that one as well. So the Aladdin partnership remains an important component of our growth strategy and credit and a significant part of our plan of expanding our network, particularly in high yield. We've made great progress and have been working through the 3 phases of this integration. So in Phase 1, we completed that in the second half of last year, and that was focused on getting dealer access and inventory data into Aladdin. Phase 2, we recently completed, and that allows Aladdin clients to respond to auto inquiries right from their Aladdin dashboard. And in Phase 3, clients will be able to initiate an RFQ on Tradeweb from within Aladdin and then also use our automation tools. So we expect, we're progressing -- we expect all phases of this to be completed over the next 12 months. And as far as the results for us on volumes, revenue and market share, we expect this to be a steady progression as we move forward with more clients within Aladdin and using Tradeweb functionality. So your question on lessons learned, yes, we integrated with Aladdin in rates a number of years ago. And the main lesson there is really that Aladdin is a very important tool for many asset managers and being partnered with them and providing easier access for those clients to Tradeweb is beneficial to us and growing our volumes. We learned that in rates. That's what we're expecting and learning and seeing in credit as well. Thanks for the question.

Our next question comes from the line of Dan Fannon with Jefferies.

I guess sticking with you, Tom, you had mentioned in your prepared remarks about looking to replicate the success and invest in high grade and high yield. And I think Aladdin to your previous response as part of that, but maybe you can elaborate on what you expect on other things you're doing and really kind of a time period you think to gauge the success of the potential share gains?

Sure. So in high yield, the goal is to continue to build out the client network, and we have been doing that. Billy mentioned, we're hiring salespeople to help build out that client footprint, and we have been making notable progress. We're also building out the dealer network, and you can see in the stats on the increase in the number of response to clients will come in the system, but ultimately, they want liquidity, and they want a lot of responses and they're getting that. As Aladdin functionality rolls out, as I mentioned, over the course of the year, this will continue to boost high-yield volume. So there's no time frame as far as when we're there and when we're done, but it's more a continuum, and we do expect to continue to grow our share over time. And this is a very sustained effort. It's blocking and tackling. It's getting clients to come over to Tradeweb for the first time and we are getting there. So that's what we're going to continue to do. Thanks for the question.

One moment for our next question. Our next question comes from the line of Craig Siegenthaler with Bank of America.

Our question is on pricing and credit. So as competition here in credit continues to intensify, how are you thinking about pricing over the long term? And in your discussions with buy-side clients, is this becoming a more relevant topic?

Craig, it's Billy. Thanks very much. We'd be crazy to say that pricing isn't part of the conversation with our clients. And if I didn't say that the right way, it would be when this call was over, right? It's a big part of the reality. That being said, we say this in a very kind of blunt way. It's not the main focus, right? Clients are focused on being able to do their job more efficiently and more intelligently. And it's important for us to always appreciate that when clients think about value, that we provide, it goes just a lot past that sort of execution fee. It starts with liquidity and functionality, but it stretches to pre-trade analytics, and really how we describe this like flow of information and Tom was talking about Aladdin but this flow of information to OMSs. And so the convenience of trading multiple products from a single platform, that's a big deal, that one-stop shop sort of emphasis that we continue to kind of make. I say this again in my -- in sort of a little bit of my own language. If pricing was the main focus, our largest competitor in institutional rates market would have all that business. And if it was the main focus, we'd be the full leader in the credit market, right? So these are kind of complex dynamics, sometimes with a complex dynamic, you simplify, right? Simple strategy, continue to provide our clients with more innovation or bang for the buck and pricing conversations always take care of themselves. And I don't say that flippantly. I say that with a lot of rigor in terms of the analysis. So we're going to continue to innovate with protocols, connecting our markets. We believe we provide a lot of value to our clients, and we have that loyalty and support, and we feel quite good about where our pricing model is today. It's a good question, Craig, thank you.

Our next question comes from the line of Ken Worthington with JPMorgan.

Congrats, Ashley. On high-yield, connection with ETF managers seems like a no-brainer to me for Tradeweb and high-yield. How big a part of the high-yield trading ecosystem are ETFs? How is rebalancing and high-yield ETFs done currently? And what needs to happen for Tradeweb to win more business in that part of the market?

Ken, yes, high yields, I should say, ETF market makers and ETF volumes coming into the cash markets continue to be a significant part of what we're seeing and a significant part of our growth strategy. We've also seen ETF market makers using portfolio trading to replicate some of those baskets. So I think us having the full range of protocols, a thorough ETF market offering, strengthen portfolio trading, RFQ and the cash bonds, all complement one another. So as far as what has to continue to happen, we continue to work on all of these protocols, building out the network, building out the responses, building out the volume and what we've seen increasingly is these players interacting across the various protocols, and we're working on ways to try to make it easier for clients to access those protocols within Tradeweb in terms of doing more than one trade or doing a package of trades at one time. So we're focused on all those things. The results have been quite promising, and it's a big part of the focus going forward. Thanks for the question.

One moment for our next question, please. Our next question will come from the line of Brian Bedell with Deutsche Bank.

Most of have been asked and answered, but maybe just one on your views on the potential clearing of treasuries, new regulations coming around and I realize it's still potentially a couple of years out, but how do you see that changing the landscape for Tradeweb in any major way and are there opportunities for you to expand your business with that new paradigm.

Sure, Brian. So just to recap, the SEC did announce the final clearing rules in December and set the deadlines for the end of '25 for cash treasuries and mid-'26 for treasury repo. In cash treasury, essentially the rule will scope in more dealers, essentially the PTFs to clear their trades. But this rule fell short of scoping an even wider variety of market participants that some had expected. So it's not as dramatic in cash treasuries. In treasury repo that is the bigger change. So substantially all of the market will be required to clear repo going forward or essentially clear repo going forward. There's a few exclusions out there, but it is most of the market. I guess what I would highlight is that there's still a number of open questions that the industry is wrestling with such as, will there be other clearing houses other than FICC entering the space as competitors and one or more have suggested that they will enter. And then what are the specifics of the protocols that are introduced by clearing houses with respect to cross margining and netting and things that. And then is there enough capacity for bank dealers who are sponsoring a large number of clients into the clearing houses and how those margin costs we shared. So these are the types of things that are being discussed in the market, being discussed in the panels. And then how might that impact liquidity. So these details are still being worked out. But ultimately, your question is what's the impact to Tradeweb? Generally speaking, more central clearing is positive for our business. It does go hand-in-hand with electronification. And as we are a large player in critical infrastructure provider in the treasury and repo markets, we're already fully connected to FICC. We already manage clear treasury business today through dealer web. We're very familiar with how all that works. And as these deadlines approach, we're going to work closely with our clients and help them navigate the rule changes as we've done in interest rate swaps. So mild positive, not a dramatic change, but this direction of travel in the regulation continues to be supportive for Tradeweb.

And our ability to have a voice around how this regulation ultimately gets implemented in the market. From my perspective, there's some pretty good feelings about that because it mimics a little bit the way that we were able to kind of get in there around, as you guys all know very well, the derivatives regulation and how SEFs reform and very important decisions that were made around really how clearing would work and the market structure of that market that gives us now, again, a bunch of years later, confidence, but also the credibility to be in there with the right people and really shape how that regulation winds up really affecting the markets that we live and breathe in. So that's a big part of this and commented that perfectly.

Our next question comes from the line of Alex Kramm with UBS.

Just wanted to come back on the discussion we had earlier about RFQ. Sounds like you're being successful there. But I know there's limited disclosures. But when I look at some of the foundational RFQ numbers that you give every quarter, I think over the last 10 quarters, you're kind of stuck in the low to high 4% market share of trade. Now that's combined high yield in IG. So I don't know if that's a fair way to look at it. But doesn't seem like you've been really able to break out, and I think 1Q was actually down a little bit over the -- from the last few quarters. So just wondering if we're looking at this right, is there's still a lot to do and what there is to do because it seems like you've been stuck a little bit. So just maybe rectify that a little bit.

I made the sort of analogy about the painting to the first question that Alex from Goldman asked me, I'm not saying you're going to like [ smudge or Picasso ], but I kind of hear where you're coming from. I think at the end of the day, as we talk about sort of where we're headed with RFQ trading and the real significant progress that we've made around that and the emphasis around that. At the end of the day, the success around that has been, I think, higher around kind of IG. And we're pretty blunt here. I think we do a lot of things very, very well. We still have more work to do on high yield. And some of that work is around the penetration of RFQ trading into high yield. But from our perspective, also it's about the adoption of portfolio trading into the less liquid areas of the market. And it's also about, and Tom described, this work that we're doing with Aladdin in terms of increasing the responder network in high yield, that's going to be a big piece of it as well. So if you felt like just everything we do in RFQ trading would perfectly apply from IG to high-yield, not so fast. It's again, the collaborative effect of really impacting the clients' workflow. And the focus in high-yield have to be 3-pronged. It has to be around, yes, RFQ, but also the continued confidence around portfolio trading plus rounding up this network of responders through integrations like Aladdin. So it's always a sort of pure focus that we have. It's a good question.

One moment for your next question. Our next question comes from Craig Siegenthaler with Bank of America.

It's Elias Abboud from Craig's team. You mentioned earlier that you've completed Phase 2 of the Aladdin integration, which was for all-to-all trading. I was wondering if you could quantify the inflection you've seen in institutional all-to-all volume since that integration was completed. So maybe we can get a peek into what the results from Phase 3 could look like down the road.

Yes. So we've definitely made significant progress there. We don't actually break out and disclose that, but I think it's safe to say that we are making progress. We see more. It's a little bit too soon, I'd say, to see the full effect because these are still coming online. And I think we'll see more of the impact later this year and into next year, but it has been a steady growth and what's been contributing to the overall market share gains that you have -- that we have been experiencing over the last year or 1.5 years. Thanks for the question.

And this concludes our Q&A portion. I'll now turn the call back over to Mr. Billy Hult for closing remarks.

Thank you all very much for joining us this morning. Any follow-up questions, obviously, always feel free to reach out to Ashley and the team. We also want to end with a little congratulation to one of our teammates Sameer, who had a baby boy who know is listening at home. Congratulations to Sameer, and everyone, have a great day. Thank you.

Thank you.

This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.