Ladies and gentlemen, thank you for standing by. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session. (Operator instructions) As a reminder, this conference is being recorded January 28, 2015.
I would now like to turn the call over to Dave Cresci, IR Manager at MarketAxess. Please go ahead, sir.
Good morning and welcome to the MarketAxess Fourth Quarter 2014 Conference Call. For the call, Rick McVey, Chairman and CEO will review the highlights for the quarter and will provide an update on trends in our businesses; and then, Tony DeLise, CFO will review the financial results.
Before I turn the call over to Rick, let me remind you that today's call may include forward-looking statements. (Forward Looking Cautionary Statements)
Now let me turn the call over to Rick.
Good morning and thank you for joining us to discuss our fourth quarter and full year 2014 results. This morning we reported record revenues, pre-tax income and diluted EPS for the full year and the fourth quarter of 2014. Fourth quarter revenues were $17 million, up 16% from the previous year; pre-tax income was $34 million, up 35% and diluted EPS was $0.57 compared to $0.41 for the prior year quarter. Q4 expenses were up just 3% to $37 million.
Our record results were driven by a combination of increased market volumes and higher market share that led to record U.S. high-grade, high yield and total trading volumes. Our estimated adjusted high-grade market share was a record 16.1% in the fourth quarter, up from 13.9% a year ago. In Europe, we saw continued momentum in Eurobond volumes, as well as record trading volumes from European clients, which were up 73% year-over-year.
Slide four, highlights our full year results and continued strong growth rates. We continue to deliver solid year-over-year growth in trading volumes, transaction revenue, total revenue and EPS. During the fourth quarter, we saw an acceleration in our growth rate as the market environment improved for secondary trading. Growth was driven by strong market share gains across our core products with high grade estimated share of 0.7% year-over-year.
2014 share gains were concentrated in trade sizes over $1 million and the average trade size on the platform increased. We had another big job in Wi-Fi [ph] participation and cross-selling during 2014. There were 900 institutional clients active on the platform during 2014, up 8% versus 2013. Almost 700 of those institutions now traded these two products on the platform and over 500 trade three or more products. Our free cash flow for the year was $95 million and in light of our strong results, our Board of Directors approved a 25% increase in our regular quarterly dividend to $0.20 per share.
Slide five provides an update on market conditions. Secondary credit trading condition shifted during the fourth quarter due to an increase in credit spread volatility mutual fund outflows and rising credit spreads. This shift led to a 9% year-over-year increase in TRACE
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