The Securities Industry and Financial Markets Association says that sell side, buy side and trading platforms expect electronic trading to grow by as much as 38% in 2007, as a percentage of European fixed-income trading volume.

This follows the sell-side reporting a 32% growth in volumes of e-trading as a percentage of the total from 2005 to 2006.

The findings come SIFMA’s second annual European Fixed Income e-trading survey. In addition to the leading sell-side firms and trading platforms, more than 302 buy-side firms with assets under management of 23.5 trillion euros participated in the survey this year.

“The increase in buy-side participation has helped create what should now be regarded as the definitive benchmark overview of all the major participants in the European fixed income e-trading marketplace,” says Mark Austen, executive director at SIFMA.

“Electronic trading is becoming the dominant method for an increasing number of firms. By the end of year, less than one percent of the buy-side surveyed will not trade electronically.”

The survey also revealed, that while awareness of new European trading regulations among buy-side respondents has improved (66% said “they weren’t aware” of them last year), still 42% said they weren’t aware of them in this year’s survey. This could be deemed a concern, as traders will need to implement much of the new directive, including best execution policies, SIFMA says.