Blog · Board and management reporting · Trading
The ten client KPIs a sales and trading desk should run on, each with its formula, the export it comes from and what it tells you: hit ratio by client and product, size-weighted hit ratio, inquiry share, the quiet client list, client tiering by flow and profitability, axe hit rate, traded unsent, coverage recency by client value, revenue concentration, and response time on inquiries. Also the three measures most desks miss, the figures to drop, the identities, and who owns what.
A desk sees a share of each client's inquiries and wins a share of those. The measures that matter show which clients trade size with the desk, whose flow has gone quiet, and whether the desk's axes reach the clients who would trade them.
| # | Measure | Formula | Export | What it tells you |
|---|---|---|---|---|
| 1 | Hit ratio by client and product | Inquiries traded ÷ inquiries received, per client, product and channel | Inquiry log; blotter | Where the desk wins and loses |
| 2 | Size-weighted hit ratio | Notional traded ÷ notional inquired | Inquiry log; blotter | Clients who trade small with the desk and size elsewhere |
| 3 | Inquiry share | Client inquiries seen ÷ estimated client inquiries in the product | Inquiry log; venue or client-stated data | Whether the desk is shown the flow at all |
| 4 | Quiet client list | Clients whose inquiries in the last 20 days are below a stated fraction of their own norm, where desk volume is normal | Inquiry log | Flow that has moved to another dealer |
| 5 | Client tiers by flow and profitability | Tier from trailing volume and revenue after cost of capital and hedging | Blotter; revenue attribution | Where balance sheet and attention should go |
| 6 | Axe hit rate | Axes traded by the client ÷ axes received, within the window | Axe log; distribution records; blotter | Whether the distribution lists work |
| 7 | Traded unsent | Clients trading the axed instrument, right side, in the window, without having been sent it | Axe log; blotter | Clients missing from the lists |
| 8 | Coverage recency by value | Revenue of clients with a two-way contact within cadence ÷ revenue | CRM or chat logs; revenue | Top clients nobody has spoken to |
| 9 | Revenue concentration | Top ten clients' share; largest client share, by product | Revenue attribution | Dependence on a few accounts |
| 10 | Response time on inquiries | Median seconds or minutes to quote, by product and channel; hit ratio by response band | Inquiry log with timestamps | Trades lost to speed, not price |
Every one of these is computed per account, per salesperson and product, and in total, and every one carries an identity that must hold before the table is shown.
Size-weighted hit ratio. Count-weighted is the default on every venue report.
The quiet client list. Revenue reports show who traded, not who stopped.
Traded unsent. Nobody joins the axe log to the blotter for clients who were not on the list.
A client sent forty inquiries in the quarter and traded eighteen: 45 percent. Notional inquired was $400 million and traded $32 million: 8 percent. Every trade over $10 million went elsewhere. Another client sent twenty inquiries, traded six, and did $70 million of $200 million: 35 percent by size. The first client ranks higher on the venue report. The second is the better relationship by a wide margin.
Inquiry count as a measure of relationship. Price-checkers inquire most.
Axes sent. Volume of distribution is not effectiveness.
Voice and electronic hit ratios blended. Two different competitions averaged into one number.
| Table | Must hold |
|---|---|
| Hit ratio | Inquiries = traded + traded away + passed + no quote |
| Axes | Matched trades are a subset of the blotter; each trade matches at most one axe |
| Tiers | Every client is in one tier; client revenue sums to the desk total |
| Coverage | Clients = covered + uncovered |
A table whose identity fails is a table with a row missing or counted twice. It is not shown until it is fixed.
| Measure | Owner | Reviewed |
|---|---|---|
| Quiet client list; coverage recency | Head of sales; salespeople | Weekly |
| Hit ratio, both weightings; response time | Head of sales with head of trading | Weekly to monthly |
| Axe hit rate; traded unsent | Head of sales | Monthly |
| Tiers; inquiry share; concentration | Head of sales and trading | Quarterly |
A measure with no owner is a metric, not a KPI; see KPI versus metric versus measure.
Ten measures from the inquiry log, the blotter and the axe records. Weight by size, compare each client with itself, and join the axes to the trades. Covirage computes all of them from the exports desks already produce, files only, with the definitions stated and the identities checked. See Covirage for sales and trading desks.
A client at 45 percent by count and 8 percent by notional is using the desk for small tickets and price discovery, and trading size with someone else. Count-weighted ratios rank that client near the top. The size-weighted figure, beside the count one, shows which relationships are real.
By comparing the client's recent inquiry and trade count with its own trailing pattern, in products where the desk as a whole has been active. A client that usually inquires thirty times a month and has inquired four times, while desk volumes are normal, has moved its flow. The rule excludes market-wide lulls.
A client took the other side of an instrument the desk had axed, in the window after the axe was sent, without being on the distribution list for it. That client would have traded the axe. It is the clearest evidence a list needs changing, and it is found by joining the axe log to the blotter.