Bloomberg LP, the parent of Bloomberg News, competes with BondCliQ in providing bond-price information.
DePodesta joined the Oakland A’s as an assistant to general manager Billy Beane in 1999 and was general manager of the Los Angeles Dodgers from 2004-05. Now the chief strategy officer for the National Football League’s Cleveland Browns, he said in an interview that he was attracted to BondCliQ by the chance to bring a systemic organizing approach to the market.
“What we were able to do in baseball is aggregate a lot of the data to better understand the world we were operating in,” he said. “I saw the same opportunity here but on a much greater scale.”
DePodesta said he’d assumed there was a certain level of price transparency in the bond market, but there isn’t.
‘Can’t Believe This’
“With each conversation there was almost an ‘I can’t believe this’ moment -- this is the way it’s done?” he said. If a bond desk makes $500 million a year “is that good?” he said. “Should that have been $1 billion or should it have been $2 million and they hit it out of the park?”
DePodesta said the use of stats to improve bond-trading performance will mirror his experience in professional sports, which was part of the inspiration for Jonah Hill’s character in the movie adaptation of Lewis’s book.
“It’s a march to the inevitable here. It was the same with baseball, it’s the same with football,” he said. “The need is so overwhelming you won’t be able to resist it.”
White wants BondCliQ to show bond traders how they stack up against counterparts at other banks so that pricing improves across the board. He said his firm will send report cards to dealer-desk heads by the end of this month and the rankings will be visible to buy-side clients in early July.
“Dealers really want to compete for order flow,” he said. “The best way to compete is if there’s more data around performance.”
--With assistance from Dan Wilchins.