MarketAxess Stock Forecast: When it comes to stocks, the future can be glimpsed sometimes by looking at a company’s history, current products, and future plans. Nowhere is that more true than with MarketAxess, a stock that has demonstrated extraordinary strength in spite of market turmoil.
Before you decide whether or not you want to add MarketAxess (MKTX) to your portfolio, take some time to learn about the company. That way, you can weigh the pros and cons, and make a decision based on facts instead of gut instinct.
MarketAxess Provides A Leading e-Trading Platform
Since its founding in 2000, MarketAxess had developed several tools and platforms that focus on investor needs.
The company does more than build software that makes it easier to profit from trades. It also provides educational materials that teach investors how to take advantage of emerging trends, day trading, and other opportunities.
A reliable MarketAxess stock forecast needs to cover the approaches that the company takes to help investors succeed. Through its e-trading and global fixed income platforms, MarketAxess aims to enhance investing in:
- High-yield trades
- Emerging markets
- Eurobonds
- Municipal bonds
- Leveraged loans
- U.S. Treasuries
- Geen bond trading
The company also develops a variety of platforms designed to meet the needs of trading agencies and individual traders.
Open Trading
Open Trading is a MarketAxess platform that lets anyone trade with anyone. You can use the software to trader with dealers or other investors.
You can even negotiate with other investors to get better deals that benefit everyone. If you don’t want to get that involved, you can post your trades to a dark pool where others can accept or deny your offers.
The Open Trading platform doesn’t follow a sink-or-swim method. It gives you tools to help you succeed. The platform integrates with data tools like:
- Trax Market Data Solutions, where you can see pre-trade intelligence.
- Composite+, where artificial intelligence helps you discover prices that fit your portfolio.
- Straight-Through-Processing (STP), which gives you real-time information about things like sub-account allocations, deal acknowledgments, and messages about trade executions.
Auto-X
Auto-X saves you time and energy by scouring markets for opportunities that match your metrics. You tell what prices, fluctuations, and behaviors interest you. The tool takes it from there.
When it finds an option that sounds right for you, you get an alert so you can review it before buying.
Is MarketAxess Stock A Buy?
MarketAxess’s stock value has grown quickly since the company went public in 2004. During 2004, the stock value hovered around $20. It continued to hold that price until 2011, when MKTX share price suddenly started to move upward.
First to $30 in 2012, then to $70 in 2013. By May 2020, MarketAxess stock had a value of over $480! Anyone who bought 100 shares in 2004 for $2,000 would have enjoyed a shareholding worth $48,000 in 2020.
Perhaps the most important thing to note about MarketAxess is that it recovered from the coronavirus slump quickly. Like most stocks, it fell during March 2020. Within two months, though, the stock spiked to its highest value ever.
Many experts believe that MarketAxess has succeeded while others fail because it takes such an innovative approach to bond trading.
Outside of MarketAxess, bond trading usually takes place between existing contacts. Within MarketAxess, you can trade without meeting anyone. You don’t even need to talk to anyone (although you can send them messages).
MarketAxess couldn’t have known this a year ago, but it built a trading tool that would stand out as an excellent option during a period of quarantine and social distancing.
Risks of Investing In MarketAxess
Price is a risk when considering a position in MarketAxess. By May the share price had bounced to new highs, which may make you feel uneasy about buying.
You can’t go back in time, though, so you need to determine whether it makes sense to buy the stock now.
A worldwide economic crash could destroy MarketAxess’s usefulness. If the world entered a prolonged depression, then MarketAxess may have a hard time connecting individuals and agencies to opportunities. In fact, MKTX stock price would likely suffer from the same anchoring effect most other companies are experiencing now.
Is that a realistic concern, though? A global economic crisis would damage the value of every companies’ stock. If so cash would truly be king.
The reality is there is enormous creative destruction taking place with a migration from brick-and-mortar to online retail, and from in-person meetings to virtual meetings. So too MarketAxess has positioned itself to win during a time of limited travel.
You could wait for the price to come down a bit. On the other hand, the 2020 spike could indicate an ongoing upward trajectory as people adjust to a new normal after the coronavirus pandemic.
Will MarketAxess Competitors Beat It?
MarketAxess has plenty of competitors. Some of the most successful competitors include:
Understanding the services that these companies offer could help you formulate a more accurate MarketAxess stock forecast.
These companies have competing tools that investors should know about. SoLo Funds, for example, lets investors earn money from peer-to-peer loans. As people struggle to make ends meet, investors who use SoLo Funds will have opportunities to generate revenue.
None of these companies, however, offer the breadth of services and tools that investors get from MarketAxess. Nor do they provide the analytics support that investors need to make successful decisions. While MarketAxess competitors are worth exploring, it’s unlikely that they will upset its industry dominance.
MarketAxess Stock Forecast: The Bottom Line
The consensus analyst estimate is that MarketAxess share price will add $50 to $100 to its current level by May 2021. The five-year forecast looks even more ambitious. The stock’s value could rise as to as high as $900 by 2025 according to some analysts’ projections.
Anyone wary of purchasing MarketAxess stock today should consider that the company still has plenty of time to grow and attract more users.
Still, no one knows how the market will behave or what mistakes a company will make. You can’t base your decisions on unknown factors, though. You can only work with the data you have. At the moment, the data favors MarketAxess in the coming years, but short term there’s enough room for uncertainty in the economic climate to cause concern.
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