During Market Shocks Navigating Volatile Markets with Greater Execution Control – The Role of Automation

There's just something about that late winter/early spring period that likes to test financial markets professionals. From the COVID-19 pandemic to the Russia-Ukraine War to the Liberation Day tariff announcements to the current situation unfolding in the Middle East, financial markets have become accustomed to shock events that force us out of our comfort zones.

While the pattern may look familiar in hindsight, the market response to each of these events has been unique and highly unpredictable, making them incredibly challenging to navigate in the moment. However, thanks to lessons learned over previous periods of extreme volatility and technology improvements that have grown out of these experiences, institutional fixed income market participants have made some significant changes to the way they manage market turbulence.

Chief among these has been the expanded use of automated trading during volatile markets. When the pandemic broke out in 2020, a deviation of a few basis points in benchmark yields was enough to provoke anyone using automated trading technology to switch back to voice execution to take manual control over the situation. In more recent market shocks, we've observed the opposite, as more trades were automated to enable both scale and efficiency of execution, even during big market moves.

Automation Stands Firm Through Iran Conflict

This burgeoning trend has been on full view following the US-Israel military strikes on Iran. The conflict rattled fixed income, equity and commodity markets around the world, but some of those reverberations were felt more strongly than others. UK 10-year Gilt yields, for example, had been falling steadily since 2024 following a series of rate cuts by the Bank of England, spiked to 5%, their highest level since the financial crisis, in response to the conflict.

While many institutional market participants were undoubtedly prepared for some sort of geopolitical conflict, few would have had been planning for a UK government bond sell-off in response to a US and Israel-led conflict in the Middle East.

Still, despite the surprising nature of the market response, automated trading volumes continued to surge on Tradeweb. In April 2026, we saw record levels of AiEX (Automated Intelligent Execution) adoption. New highs in European Credit saw 84% of trades done via AiEX, as well as 60% of total traded volume. *

That momentum builds on what we saw in March, where automated ticket share rose 26.4% year-on-year as the conflict began to unfold.

That is a notable vote of confidence in automation, but it was not an isolated event. Between April 2 and April 9 of last year, for example, following the Liberation Day tariff announcements, an average of 54,296 tickets were automated per day, exceeding a typical month-end level by approximately 4.5%. By the end of April 2025, AiEX tickets were up 9% over March 2025 levels. *

Part of this trend can be explained by the ever-increasing level of reliance of trading desks as automation activity increases. But this is also a reflection of recent technological enhancements that have helped firms navigate fragmented liquidity in these varying market conditions. The resulting reliability and flexibility delivered by AiEX is helping market participants continue to scale their trading activity by delivering best execution and streamlined operational workflows in all market conditions.

A Flexible Approach to Automation

These enhancements include hybrid workflows that embed exception management directly into AiEX transactions, allowing traders to step-in through a pop-up window when predefined thresholds are not met. Automation no longer comes at the expense of control. Traders can now fine-tune how they use automation. Whether it's fully automated, zero-touch execution, low-touch workflows with the option to intervene, or high-touch trading where key decisions remain manual, AiEX supports a range of approaches. Across these strategies, traders can apply more than 100 execution parameters.

In credit markets, this flexibility goes further. Pre-trade analytics assess real-time liquidity conditions to determine the likelihood of execution. Traders can use this insight to decide which orders to send to market and how best to execute them.

The result is more targeted automation, improved hit rates, and lower transaction costs. It also allows traders to hold back when conditions aren't favourable, avoiding unnecessary market impact.

Efficiency Without Compromise

As automation becomes more adaptable, traders are gaining efficiency without giving up control. By combining real-time data, historical insights and customizable execution parameters, AiEX helps firms manage trading activity more effectively during periods of volatility while maintaining execution quality.

The benefits are clear: faster execution, lower costs, greater certainty and a reduced market footprint. Adoption reflects this. In Q1 2026, 58% of all tickets on Tradeweb were executed via AiEX, up from 39% four years ago. In European credit markets, that figure reached 78%, compared to 57% in Q1 2022. *

Automation is no longer limited to stable conditions. With greater flexibility and control, it is now a core part of how traders navigate volatility.

*Source: Tradeweb - Excludes portfolio trades

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