Baron Financials ETF on Tradeweb Markets Inc.
Thesis
Baron continues to own Tradeweb despite weaker trading activity as market volatility moderated during the quarter. The fund believes Tradeweb has strong network effects and a long history of innovation in electronic fixed-income trading. Continued electronification of capital markets provides a significant structural growth opportunity that Baron believes outweighs current concerns about competing blockchain-based derivatives.
“We continue to own the stock given Tradeweb’s strong network effects, long track record of innovation”
Key risks
- Slower trading activity during periods of moderating market volatility
- Competition from blockchain-based perpetual futures products