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AxeTrading partners with Exchanges to deliver an efficient, effective and modern fixed income trading experience

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AxeTrading does not compete with trading venues, but partners with them to deliver an efficient, effective and modern fixed income trading experience that enhances and develops their local bond markets to meet their commercial objectives and those set by governments, financial authorities, and bond market associations.

Working with International Finance Corporation, part of the World Bank Group, as a strategic partner, AxeTrading continues to accelerate the evolution of fixed income markets by delivering advanced technology for dealers and trading venues to broaden participation, which provides liquidity and market transparency. AxeChange is the software to power execution venues for fixed income products and enables the trading of government, corporate, sukuk and retail bonds across major and local currencies. It connects to the full range of local and international capital market participants through a range of front-end user interfaces including the AxeTrader Quoting and Execution Management System, the web, and other platforms via the FIX protocol.


In emerging bond markets, in order to achieve market development and growth to benefit the wider economy and to better meet growing local funding requirements, exchanges, governments and regulators recognise the need to increase market transparency, as well as the size and number of bond market participants, which will drive interest from investors and new debt issuers.

Historically, bond markets have lagged behind equity and other listed markets when it comes to transparency and efficiency. To develop the bond markets, which are a critical component of an efficient capital market in a growing economy, exchanges can play a critical role. However, the exchanges’ technology tends not to be suitable for bond and sukuk market trading and transparency.

In order to play their part in market development, exchanges in these developing economies have to innovate their offering and adapt to the unique characteristics of bond trading, otherwise the bond markets will not move to these exchanges; they will otherwise remain opaque, mostly voice-trading based and facilitated by brokers who control the information. This lack of transparency will continue to stifle development unless the exchanges can adapt and evolve to accommodate the bond markets’ requirements. To add to the challenge, while this transformation is taking place exchanges need the right technology to effectively embrace the requirements of both voice and electronic trading.


Indonesia is the largest economy in South East Asia, one of the fastest growing economies in the world and has one of the largest bond markets in the region, valued at around USD 220 billion equivalent (source: ADB), and has significant potential to grow.

The Indonesia government and corporate bonds secondary market has been long traded Over the Counter (OTC): it is primarily voice traded, largely facilitated by brokers who controlled the flow of information. The Indonesia Stock Exchange (IDX) saw the opportunity to take the initiative to develop its business as an exchange facilitating bond trading and organize the secondary market using its unique strategic position.

To achieve this the IDX identified the need for an Electronic Trading Platform (ETP). Initially they developed their own internal ETP solution that was simple in design and had limited bond-trading specific facilities. However, IDX soon recognised that the technology challenge required IDX to join forces with a technology partner who possesses the necessary fixed income markets’ expertise. After a comprehensive screening and selection process involving leading specialist providers worldwide, IDX selected to partner with AxeTrading.

With their new AxeChange technology solution provided by AxeTrading, IDX intends to increase liquidity, improve efficiency and bring price transparency to the Indonesian secondary market for government bonds issued by Ministry of Finance Republic of Indonesia, as well as corporate bonds, sukuk (sharia bonds), and retail bonds.


In September 2019 IDX officially appointed AxeTrading to become their technology partner to advise develop and build the ETP for Indonesian bonds and sukuk instruments using AxeTrading’s AxeChange fixed income trading technology, built on a modern, flexible architecture that is designed for integration and inter-operability.

AxeTrading was chosen by IDX among other global prospective providers for its more than 10 years of specialist experience in electronic trading and its expertise in the fixed income market. Furthermore, AxeTrading satisfied IDX with our ability to support the ETP platform and its users, and our commitment to a long-term partnership with IDX to fulfil all their requirements and bring the desired efficiencies to the bond market in Indonesia.

IDX also sees opportunities to capitalise on market data revenue by operating their own ETP. AxeTrading enabled IDX to own their Indonesia bond market data which was a key differentiator compared to other prospective partners.

In the initial stage, to maximise engagement with market participants, IDX and AxeTrading consulted with the bond dealers of the Indonesian Inter-Dealer Market Association (IDMA) and HIMDASUN, the local bond market working group. We conducted focus group discussions with these market players to identify all the necessary business needs and set the specifications. The ETP provided by AxeChange has thus been configured and delivered to accommodate the needs of the bond and sukuk market players in Indonesia.

The AxeChange platform offers flexible trading mechanisms and features that will increase trading participation by market players.

Furthermore, the ETP brings more transparency for price discovery, as well as efficiency and ease of reporting to the regulatory authority. With this solution, the expectation is that the IDX ETP will become the preferred platform for bond and sukuk trading in the secondary market in Indonesia, and will make it possible to support the needs of stakeholders including OJK (Financial Services Authority of Indonesia), the Ministry of Finance, and the Indonesia Central Bank to monitor the bond and sukuk market trading in Indonesia.


After one year of further development the ETP went live in November 2020 and is the first stage of IDX’s continuous initiatives for the ongoing development of the Indonesian bond market.

The ETP is known officially as the ‘Indonesia Alternative Market Trading System’ (Indonesian acronym: ‘SPPA’) and had to meet the standards required by the Indonesia Financial Services Authority to enable trading in an orderly, fair and efficient manner.At launch, twenty fixed income dealer firms were selected as the first users, of which eighteen were the appointed Primary Dealers in Indonesian government bonds.

This number is targeted to hit 30 in January 2022, when the Indonesia Ministry of Finance implements a mandatory obligation for each of the Primary Dealers to quote prices on the ETP in benchmark bonds throughout the trading day. This will have the simultaneous effect of increasing transparency and efficiency in the market.

Indonesian Bond Market dealers are able to access the ETP either by use of a modern web-based HTML5 user interface via their chosen internet browser, or by connecting directly via the widely used FIX protocol though an execution management system such as AxeTrader.

This FIX API also allows users to plug in their existing trading architecture. The ETP has a range of bond- and sukuk-market specific features such as:

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