Insight
February 2026
Mike Norwood
Monthly Securities Finance Market Review: January 2026
EquiLend’s Head of Trading Solutions, Mike Norwood, shares his January securities finance market review, highlighting how 2025’s record momentum carried into the new year across EquiLend NGT. The following data has been measured and derived from EquiLend NGT.
NGT Opens 2026 With Strong Year-Over-Year Growth
Securities lending volumes carried 2025 momentum into January as markets navigated geopolitical tensions, sector rotation, and unprecedented capital flows into Asian markets. Volumes recorded on EquiLend’s NGT platform reached 3,502,222 trades executed versus $4.02 trillion in notional, representing 19% year-over-year growth in total trades and 25% growth in daily average trades.
Although total trades declined 2% month-over-month following December’s seasonally elevated year-end activity, daily averages were up by +6%, powered by an +8% gain in fixed income, as equity activity softened by -5%.
After record-setting 2025 performance (39.5M trades, $44.6T notional), markets entered 2026 with persistent volatility driven by Middle East tensions, tariff threats, and Fed independence concerns. The nomination of Kevin Warsh as Fed Chair sparked currency and commodity fluctuations, while Asian equity markets experienced a rush of capital. APAC took the lead on regional growth with daily average trades up +20% (equity) and +30% (fixed income) month-over-month.
Sector Borrowing Reflects Valuation Concerns and Rotation
By trade notional, Information Technology remained at the top of global sector rankings despite underperforming in January, reflecting continued hedging of concentrated mega-cap positions and caution around AI valuations. Semiconductor names were a key driver, particularly in Asia, with SK Hynix and Samsung representing 30%+ of Korea’s KOSPI.
Industrials and Financials ranked second and third, supported by elevated defense and aerospace valuations and modest pressure on bank equities, which declined -3.5% in January. Consumer Discretionary borrowing reflected growing concerns around consumer spending sustainability.
In Canada, Materials and Energy dominated activity amid a sharp commodity rally, with oil up +13%, gold spiking toward $5,000, and copper at near-record levels. Across the U.S., APAC, and Canada, specials priced above 251+ bps representing 20-29% of equity trades, highlighting persistent hard-to-borrow demand.
Fixed Income Delivers Strongest Growth
Fixed income outpaced equities with trade volumes up +8% month-over-month and clear regional gains: EMEA +21%, APAC +30% in daily average volume. Central bank policy divergence (Fed holding, BoJ signaling tightening) and robust new issuance drove collateral optimization and borrowing demand across sovereigns and credit, with investment-grade spreads tightening to multi-decade lows.
APAC: The Standout Growth Engine
Asia Pacific emerged as January’s most dynamic region with total trades reaching 396,048 (+10% month over month) and $305 billion in notional. Activity reflected exceptional capital inflows, record turnover in Chinese exchanges, and concentrated semiconductor positioning that continued to drive hedging and short-sale activity.
Looking Ahead
Overall, January demonstrated that the structural drivers powering 2025’s record year remain intact. According to EquiLend Data & Analytics, global securities lending revenue reached $1.24 billion in January (+32% year-over-year), driven primarily by increased loan balances (holding above $4 trillion) rather than fee expansion. The +19% year-over-year trade growth and +25% daily average growth signal greater engagement and continued adoption of automated trading platforms like NGT.
The divergence between asset classes, with equities normalizing and fixed income accelerating, points to a more balanced growth profile for 2026. APAC’s growth transformation, EMEA’s fixed income strength, and U.S. market resilience, position NGT for continued expansion.
Heading into February, the picture looks positive for another strong year in securities finance with geopolitical uncertainty supporting hedging demand, semiconductor concentration requiring position management, credit spread compression driving collateral optimization, and elevated valuations across cyclical sectors creating short interest opportunities.
Within global equities, NGT’s most in-demand sectors were:
Stay tuned for the latest securities finance trends, trading analysis and commentary with EquiLend’s Monthly Trading Commentary.
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