Investortools integrates Spline Data pricing tool

Investortools is integrating a real-time pricing tool into its Dealer Network and order management system, the company announced Monday.

Users now have access to Spline Data’s Predictive Municipal Bond Pricing system, which “delivers market-tested bond pricing, enabling fund managers and separately managed account providers to swiftly evaluate market bonds against precise execution price estimates,” according to a press release.

The tool consistently maintains a margin of error of less than six basis points and errors have zero skew, the release said.

The deal is the latest in a series of technical integrations for Investortools. Earlier this month, the company added another predictive pricing tool from Solve to its Dealer Network.

Spline Data’s tech differs from other similar products because their model is “meant to mimic how a human would go about pricing a bond,” said Matthew Smith, the company’s founder and CEO. It’s set up as if it is a collection of traders with a top-level optimizer looking at which is performing best at different times, he said.

Smith also said its user support is more thorough than other price predictors.

“You can have the best model in the world, but if someone isn’t there to see you realize the value of the model, it’s worthless,” he said. “We spend a lot of time with folks who are unfamiliar with this type of data or might be confused about the value of it.”

The hope is that the integration will hasten buy-side adoption of pricing data, Smith said. In his view, that side of the industry has been slow to embrace the technology because of “how separated the value proposition is.” 

If they spend money on bond pricing now, they may not see the benefit for months and thus won’t immediately see the value reflected in success metrics, he said. Integration is the “quickest way we can reach the buy-side.”

“The goal with this is really to make it easier to integrate, hopefully shortening that lead time to see the benefits of pricing,” he said.

Mike Green, chief operating officer and co-head of Investortools, said Spline Data is “highly regarded for its predictive pricing model and requested by our clients.”

“Our integration with Spline Data reflects our broader commitment to expanding access and choices for pricing providers across the platform,” he said in a statement.