BLK's Aladdin Ties Up With OTCX to Digitize OTC Derivative Trading

Core Insights - BlackRock Inc.'s Aladdin platform has entered a multi-year collaboration with OTCX to digitize dealer-to-client voice derivative trading and expand options for clients [1][9] Group 1: Partnership Rationale - The partnership aims to address the industry's reliance on manual, voice-based workflows in complex derivatives, providing better choices for vanilla derivatives for electronic trading [2] - The collaboration will integrate OTCX's execution venues into the Aladdin platform, enhancing efficiency, transparency, and cost-effectiveness in pricing, risk management, and trade execution for OTC derivatives [3] Group 2: Workflow Support and Revenue Diversification - Aladdin clients will benefit from comprehensive workflow support, including price discovery, request-for-market to execution, and post-trade processing, with connectivity across a wide range of OTC derivatives [4] - This partnership supports BlackRock's strategy to diversify its revenue mix towards high-margin, recurring tech income, reinforcing Aladdin's role as a key differentiator and growth catalyst [4] Group 3: Growth Efforts - BlackRock is actively pursuing growth through both organic and inorganic means, including the recent acquisition of ElmTree Funds to enhance private market offerings and managing an approximately $80 billion customized portfolio for Citigroup's global wealth clients [5] Group 4: Market Performance - Year-to-date, BlackRock's shares have increased by 15%, contrasting with a 6% decline in the industry [7]