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October 12, 2010 at 09:40 AM
A free monthly report just launched by leading fixed-income technology firm Bond Desk now offers a wealth of information about the corporate bond market to retail investors and their financial advisors.
The newly launched BondDesk Market Transparency Report, which gets posted as a PDF on the BondDesk website’s homepage, focuses exclusively on corporate bond trading activity among retail investors. The report is designed to help them and their advisors gain a better understanding of this massive and complicated area of the fixed-income market.
“A unique aspect of this report is that it is directed at retailers, meaning folks who take relatively small positions in bonds. That’s really what distinguishes this report from lots of other fixed-income reports that are focused on the wholesale market,” said Yuval Bar-Or, author of the book, "Play to Prosper: The Small Investor’s Survival Guide," and an adjunct professor of finance at Johns Hopkins University's Carey Business School in Baltimore, in a phone interview.
“Big institutions typically buy bonds in the area of $100 million. Here, we’re looking at small purchases of maybe five or seven or 11 bonds, up to 100, which would be initiated by the average person on the street either directly or as recommended by a financial advisor,” Bar-Or added.
Regulators define retail trades as “odd?lot transactions” under 100 bonds, which are equal to less than $100,000 par value. But while the retail market is much smaller than the institutional market on a par value basis, it accounts for roughly 75% of the trades that occur in the marketplace. The Market Transparency Report intends, as the title suggests, to provide transparency into the dynamics of the corporate bond market for retail investors. It describes trends in the market, including trading volumes, most active issuers, yield and spread movements, and significant credit downgrades and upgrades.
