Examining Technology Enactment in the Fixed Income Market

While the use of electronic trading systems (ETS) in fixed income (FI) market is becoming more common in the last few years, only a small number of empirical studies have been conducted to examine their adoption and impact in the market. In this study, we use the technology enactment framework (TEF) to identify various institutional and organizational factors that influence ETS adoption. Based on a comprehensive survey and face-to- face interviews with senior managers, sales representatives, and traders from major Canadian financial institutions, we find that the FI market is characterized by a high level of embedded relationships and that the ETS users do not entirely trust their ETS. This study also presents, among others, important findings regarding the impact of ETS on the users' job performance and their perception about the asymmetric nature of benefits provided by ETS in the FI market.