BondDesk regularly publishes our own market commentary and analysis, including our monthly Market Transparency Report. Occasionally we also publish papers written by Asset Dedication, an RIA affiliated with BondDesk. Please download the following documents to take advantage of our unique insights into the retail fixed income markets.
December 2013 Market Transparency Report: November 2013
- Dec 02
November 2013 saw a decline in median yields for Treasuries, CDs, and Corporates, while yields increased slightly for Agencies, and Municipal bond yields remained relatively unchanged.
Average daily trading volume also decreased during the month for Treasuries, CDs, Agencies and Municipals, with a two percent increase in daily volumes for Corporates.
November 2013 Market Transparency Report: October 2013
- Nov 04
In October, yields were up for Treasuries and CDs but down for Agencies, Corporates and Municipals.
Daily trade volumes and the buy-to-sell ratio were down or flat for all asset classes.
October 2013 Market Transparency Report: September 2013
- Oct 01
In September, median yields were down for Treasurys and Municipals, up for Corporates and unchanged for Agencies and CDs.
Trade volume was also mixed with volumes being down for Treasurys and Municipals, up for Corporates and CDs and unchanged for Agencies.
The buy-to-sell ratio was up for all asset classes accept for Municipals and Treasuries.
September 2013 Market Transparency Report: August 2013
- Sep 04
Based on customer buy transactions on the BondDesk platform in August, median yields were up for all asset classes.
Trade volumes were up for Treasurys but down for all other asset classes, while the buy-to-sell ratio was up for Corporates and Municipals while down or flat Treasurys, Agencies and CDs.
August 2013 Market Transparency Report: July 2013
- Aug 01
Based on customer buy transactions on the BondDesk platform in July, median yields were up for Agencies and CDs while down for Treasurys, Corporates and Municipals.
Trade volumes were down for all asset classes except CDs and the buy-to-sell ratio was up for all asset classes except Treasurys.
July 2013 Market Transparency Report: June 2013
- Jul 11
Yields and daily trade volumes were up for all asset classes in June with significant spikes occurring in each category for Municipal bonds.
The buy-to-sell ratio was also up for all asset classes with the exception of Agencies.
June 2013 Market Transparency Report: May 2013
- Jun 03
Yields were up in April for Treasurys, Agencies and Corporate bonds but remained flat for CDs and Municipals.
Daily trades volumes were up for Treasurys and Corporate bonds, down for Agencies and flat for CDs and Municipals.
The buy-to-sell ratio was up for Agencies and CDs, down for Corporate bonds and flat for Treasurys and Municipals.
May 2013 Market Transparency Report: April 2013
- May 03
Yields were down in April for Corporate Bonds, Treasurys and Agencies, while they were flat for Municipal bonds and up for CDs.
Daily trade volumes were down for all asset classes except for Municipals which were flat.
The buy-to-sell ratio was down for all asset classes except Corporate bonds which were flat.
April 2013 Retail Liquidity – The Evolution of Fixed Income
- Apr 23
This research note from the Tabb Group explores the role that retail alternative trading systems (ATS) are having in the evolution of the fixed income markets.
Key observations include the high quality markets that can be found on the BondDesk ATS in offering lots between 100 and 500 bonds.
Market Transparency Report: March 2013
- Apr 02
Yields were down in March for Corporate Bonds, Treasurys and CDs, while they were up for Municipal bonds and flat for Agencies.
Daily trade volumes were flat or down for all asset classes except CDs.
The buy-to-sell ratio was flat or up for all asset classes except Corporate bonds.
March 2013 Market Transparency Report: February 2013
- Mar 05
Yields were up slightly in February for Treasuries, Agencies and Corporates while down slightly for CDs and Municipals.
Daily trade volumes for Corporates were flat, but remained close to their 12-month highs.
Volumes for Municipals were up slightly but down for Treasuries, Agencies and CDs.
The buy-to-sell ratio was up slightly for CDs and Treasuries while down slightly for Agencies, Corporates and Municipals.
February 2013 Market Transparency Report: January 2013
- Feb 05
Yields remained flat in January for Treasury, CD and Municipals while increasing slightly for Agency and Corporates.
Daily trade volumes in January spiked for Corporates, dropped sharply for Municipals and increased slightly for Treasury, Agency and CD.
The buy-to-sell ratio increased slightly for all asset classes.
January 2013 Market Transparency Report: December 2012
- Jan 04
Yields dropped in December for Treasury, CD, Corporate and Municipal bonds while yields on Agency inched up slightly.
As daily trade volumes for Corporate bonds reached a 12-month low, there was a sharp increase in daily trade volume for Municipal bonds and a slight increase in trade volume for Treasury and Agency.
For all asset classes the buy-to-sell ratios reached new 12-month lows.
December 2012 Market Transparency Report: November 2012
- Dec 04
Yields in Treasury, Agency, CD and Corporate bonds were flat or slightly higher for October while Municipal yields declined further to set a new 12-month low.
Trade volumes were up slightly for all asset classes with the exception of Municipal volumes which were up significantly (8% increase).
The buy-to-sell ratio dropped for all asset classes with the exception of Corporates which remained flat.
November 2012 Market Transparency Report: October 2012
- Nov 02
Yields in Treasury, Agency, CD and Corporate bonds all increased slightly from September levels but remained close to 10-year lows.
Municipal bond yields continued their decline in October and with the median yield at 2.8% set a new 12-month record low.
Trade volumes dropped in October for all asset classes while the buy-to-sell ratio dropped for all asset classes except Municipals.
October 2012 Market Transparency Report: September 2012
- Oct 02
Yields in Treasury, Agency, CD, Corporate and Municipal bonds all reached 12-month low levels, with yields in many of these asset classes reaching 10-year lows.
Trade volumes were up for all asset classes except Treasuries and Municipals and the buy-to-sell ratio fell for all asset classes except Municipals which remained flat.
September 2012 Market Transparency Report: August 2012
- Sep 04
Trade volumes for Agency, CD and Municipal bonds declined in August while volumes for Treasuries and Corporates increased.
Reversing a declining trend over the past seven months, there was an uptick in Agency yields.
Corporate and Municipal yields also declined in August with Corporates nearing the 12-month low levels that were set in March 2012.
August 2012 To Find Liquidity in Corporate Bonds, It Pays to 'Think Odd'
- Aug 23
Electronic corporate bond markets are suddenly all the rage. Goldman Sachs has launched one. Black Rock has announced one. And now a large group of major Wall Street buy-side and sell-side firms are discussing yet another. Apparently, much of Wall Street now believes that a new, centralized electronic market will be required . . .
Market Transparency Report: July 2012
- Aug 01
In July, daily trade volume in Treasury, Agency and CD declined from June levels amid a slight drop in yields in Treasury and Agency.
Reversing the trends over the previous three months, yields and credit spreads in Corporate bonds decreased slightly.
At 3%, the median yield for Municipal bonds in July was at a 12-month low.
July 2012 Market Transparency Report: June 2012
- Jul 03
Daily trade volumes for Treasuries, Agencies, Corporates and Municipals increased in June while trading volumes for CDs remained flat.
Yields on Corporate bonds continued their modest increasing trend that began in April.
Yields on Municipals climbed slightly in June reversing the declining trend over the past two months.
In the Corporate bond market, bonds from financial firms once again dominated trade volume in odd-lot transactions.
June 2012 Market Transparency Report: May 2012
- Jun 05
Short term money market type securities including Treasuries and CDs posted increased transaction volumes for May,
in comparison to trading activity for Corporates, Municipals and Agencies which were down from prior month.
Median yields in Municipals reached their lowest levels on a trailing 12 month basis.
Corporate yields have shown a modest uptick over the past two months.
In the Corporate bond markets, 8 out of 10 most actively traded issuers were financial firms, consistent with trends noted earlier this year.
May 2012 Market Transparency Report: April 2012
- May 02
Overall trade volumes across all asset classes was down slightly from March levels.
Corporate markets were dominated by financial firms.
8 of the top 10 most actively traded issuers in corporates were financials, representing 30% of overall volume.
Municipal volumes and yields, remained at the lower end of their 12 month trading range.
April 2012 Market Transparency Report: March 2012
- Apr 05
Median yields in Agency, CDs and Corporate Bonds continued their declines in March, reaching 12 month lows, coincident with declines in yields.
Municipal securities showed a slight volume uptick in March despite yields on the low end of their trailing 12 months.
In the corporate bond market, financial firms dominated trade volumes.
Eight of the top ten most actively traded issuers were financials, making up 26% of odd lot transactions in March.
March 2012 Market Transparency Report: February 2012
- Mar 05
Corporate bonds posted a modest volume uptick in February vs. prior month. Corporate yields appear to be stabilizing,
following a 50 basis point drop over the past 6 months. On the other hand, Municipal securities are trading at the low
point of both yields and volumes on a trailing twelve month basis.
February 2012 Market Transparency Report: January 2012
- Feb 05
Median yields on treasuries continued their upward trend, following their bottom trough in the June through August period last summer.
Yields on the benchmark 10 Year remained below 2.0% despite the upward trend.
Both Corporate and Municipal markets showed upticks in overall transaction volumes, despite lowered yields in these security classes.
January 2012 Municipal Market Transparency Report: December 2011
- Jan 06
December was a quiet month in the muni markets with no bankruptcies or defaults. Retail demand for individual municipal bonds was relatively strong in December, particularly considering it was the holiday season. Mutual funds had a very strong December, receiving $4.4B in net inflows (according to Investment Company Institute), which was easily the high-water mark for 2011. Median municipal yields fell consistently during December (and prices rose), largely due to the increased demand in the mutual fund market.
Corporate Market Transparency Report: December 2011
- Jan 06December was a relatively calm month on Wall Street, particularly compared to the extreme volatility of 2011. Concerns about Europe surfaced briefly, but by the end of the month all three major U.S. stock indices had recovered their losses. Corporate yields and spreads were essentially flat last month while transaction volumes were down slightly due to the holiday season. Demand for taxable (i.e., corporate) bond funds was moderate during December. According to the Investment Company Institute, mutual funds received $9.3B in net inflows vs. $15.5B during November.
BondDesk 2011 Market Recap
- Jan 03Volatility was the new normal in 2011, as financial markets were confronted with a seemingly endless supply of global macroeconomic crises. In this brief recap we examine the extraordinary events of 2011 and the impact they had on the domestic retail fixed income markets.
December 2011 Corporate Market Transparency Report: November 2011
- Dec 08November was an extremely volatile month on Wall Street. Concerns about Europe caused a temporary free fall in the equity market, and later in the month American Airlines filed for Chapter 11 bankruptcy protection. Not surprisingly all the turmoil drove up yields for corporate bonds as concerns about credit risk resurfaced. Single A rated corporates experienced the biggest increase, and BondDesk continues to believe that investors looking for yield should consider purchasing those bonds opportunistically. Demand for corporate bonds also increased in November, marking the fifth consecutive month buying activity has gone up. Demand for corporate bond funds also was quite strong in November, pulling in $17.4B in net inflows.
Municipal Market Transparency Report: November 2011
- Dec 08Once again, the big muni news last month was another high-profile bankruptcy. Jefferson County, Alabama filed for Chapter 9 protection on November 9. Although this was the second consecutive month with a large municipal bankruptcy announcement, the retail markets were unfazed. In fact, November demand increased substantially over October levels, even with the light trading during Thanksgiving week. And municipal mutual funds also had a strong month, pulling in $2.9B in net inflows.
November 2011 Corporate Market Transparency Report: October 2011
- Nov 07October was the best month in nearly a decade for the U.S. stock market. As expected, the strong equity rally caused retail corporate bond yields to fall as concerns about credit risk receded. Bonds rated single A experienced the biggest decrease in yields, though yields for triple B bonds remained largely unchanged, providing continued opportunity for investors willing to own lower rated investment grade bonds. The buy sell ratio increased to 1.9 in October, a modest increase over the 1.8 ratio in September but a material increase over the historical norm of 1.4.
Municipal Market Transparency Report: October 2011
- Nov 07The big muni news last month was that Harrisburg, the capital of Pennsylvania, filed for Chapter 9 bankruptcy protection. But the incident did not have much impact on the retail markets. In fact, trading activity in October recovered from the ultra low levels of August and September, though it was still a relatively quiet month. Mutual funds had a solid October, receiving 1.8 billion in net inflows according to the Investment Company Institute.
October 2011 Municipal Market Transparency Report: September 2011
- Oct 10September was another extremely quiet month in the retail market for individual municipal bonds. The average number of investor buy trades per day was just 13,667 in September, which is only the second time buying activity has fallen below 14,000 TPD since we began tracking the metric in January, 2009. Selling activity was also low in September, but it was not as extreme by historical standards. There were 5,641 investor sell trades per day in September, which is less than last month but still within the normal range.
Corporate Market Transparency Report: September 2011
- Oct 10September was another dramatic month on Wall Street. A steady stream of bad news from Europe, concerns about the domestic economy, and yet another intervention from the Federal Reserve (Operation Twist) roiled equity markets. By the end of the month, all three major domestic indexes had lost over 6 per cent. The turmoil impacted yields for retail corporate bonds as expected, but the effect was not consistent across rating grades. Repeating the trend from August, yields for 2nd tier investment grade (A, BBB) bonds increased substantially, while upper tier (AAA, AA) were largely unchanged.
September 2011 A Buying Opportunity in Investment Grade Corporates
- Sep 28Given that yields on Treasury and top tier corporate bonds are near 50-year lows, investors looking for relative value in fixed income should consider purchasing lower rated investment grade corporate bonds. Since late July, when the equity market started falling in response to the European debt crisis and the simultaneous U.S. debt ceiling standoff, yields on lower rated investment grade bonds (BBB and A) have increased substantially.
Corporate Market Transparency Report: August 2011
- Sep 09August was a brutal month on Wall Street. Most of the damage occurred during the first few weeks, following the debt ceiling debate in Washington and the ensuing Standard and Poors downgrade. All three major domestic equity indexes (S&P500, DJIA, and NASDAQ) lost at least 10 percent from 8/1 to 8/8. Yields on high quality corporate bonds (AAA and AA) decreased in August as investors sought safe haven from the turmoil in the stock market. But yields on the lower quality investment grade bonds (A and BBB) increased, as investors grew nervous about rising credit risk.
Municipal Market Transparency Report: August 2011
- Sep 08August was another slow month in the retail market for municipal bonds. The combination of the debt ceiling standoff in Washington and the subsequent S&P downgrade significantly reduced demand for individual muni bonds, particularly early in the month. Trading volumes recovered somewhat by the end of August, but demand remained light.
August 2011 Municipal Market Transparency Report: July 2011
- Aug 05July was a rough month in the retail market for municipal bonds. Thanks to the debt ceiling standoff in Washington, demand for individual muni bonds dropped to its lowest level since last summer. Still, in spite of falling volumes, retail investors remained strong net buyers. In July the national buy/sell ratio was 2.6, which is identical to the June ratio. Credit spreads rose but yeilds held steady because Treasury yields dropped most of the month. Remarkably, Treasuries were rallying all month even though default was a legitimate possibility.
Corporate Market Transparency Report: July 2011
- Aug 05The first three weeks of July were relatively quiet on Wall Street, but the mood turned tense as the debt ceiling standoff approached its final days. Demand for individual bonds dropped, with buying activity decreasing and selling activity increasing. The buy/sell ratio for corporate bonds fell to 1.3 (from 1.4 in June), reflecting the change. Corporate spreads rose but yeilds held steady because Treasury yields dropped most of the month. Remarkably, Treasuries were rallying all month even though default was a legitimate possibility.
July 2011 Corporate Market Transparency Report: June 2011
- Jul 11Wall Street was in a gloomy mood during most of June. Concerns about the Greek debt crisis and fears of a potential double-dip recession in the U.S. extended the equity selloff that began in May. But the last week of June was a different story. After Greece received its latest bailout package, the clouds suddenly lifted over the stock market and each domestic index increased over 2.75% in just 4 trading days. Corporate spreads mostly tracked the equity market, widening all month until the equity rally began. Treasury yields were mostly flat until the end of the month, so corporate yields increased in June. Demand for corporate bonds was light on a relative basis but the buy/sell ratio increased to 1.4 (from 1.2 in May), indicating a bullish outlook by retail investors.
Municipal Market Transparency Report: June 2011
- Jul 11The retail market for individual municipal bonds continued to stabilize during June. For the third consecutive month, trade volumes and yields were relatively consistent, suggesting the frenzied trading activity and escalated fears of January and February are no longer impacting the market. The buy/sell ratio in June increased to 2.6 (from 2.4 in May), indicating that investors are becoming more bullish. Net flows into muni mutual funds were positive in June for the first time since October, but on a relative basis the inflows were quite low.
June 2011 Municipal Market Transparency Report: May 2011
- Jun 06
Demand for individual municipal bonds among retail investors began to stabilize in May. Trade volumes have been falling consistently since peaking in January, but volumes in May were very similar to the levels in April (though still slightly lower). More importantly, the May figures are consistent with 2010 averages, suggesting the market is returning to 'normal.'
Corporate Market Transparency Report: May 2011
- Jun 06
Wall Street was in a jittery mood during May. Negative domestic economic data coupled with a steady supply of bad news about the Greek debt crisis triggered a 'flight to quality' that sent investors out of equities and into the Treasury market. Retail demand for corporate bonds was low in May, presumably because of low yields, but demand for corporate bond funds was quite strong, with over $20B in new inflows according to ICI.
May 2011 Trading Costs in Odd-lot Bond Transactions
- May 23This paper presents a novel approach for estimating trading costs of corporate and municipal bonds based on reported over-the-counter transactions in the U.S. The paper focuses on trading costs in odd-lot transactions (typically considered transactions in less than 100 bonds) which make up the majority of trades by retail investors. For 'investor buy' trades, we estimate the typical all-in cost is around 20 basis points for corporate bonds and 23 bps for municipal bonds.
Municipal Market Transparency Report: April 2011
- May 06Demand for individual municipal bonds among retail investors continued to soften in April. Nonetheless, the behavior among retail investors who bought individual muni bonds remained distinct from the retail investors who bought muni bond funds. Retail investors of individual muni bonds were still overwhelmingly net buyers, while fund investors continued to sell their postions aggressively.
Corporate Market Transparency Report: April 2011
- May 06Corporate yields fell precipitously in April, mostly due to a similar decrease in Treasury yields (corporate spreads were essentially flat last month). As expected, low corporate yields depressed demand among retail investors so April trading activity was particularly light.
April 2011 Muni Market Transparency Report: March 2011
- Apr 12March was an intense month around the globe, with U.S. military action in Libya and a devastating earthquate/tsunami in Japan, but it was a quiet month in the retail market for municipal bonds. Median yields were essentially unchanged, starting at 4.65% and ending at 4.62%, with a handful of minor fluctuations in between. Corporate Market Transparency Report: March 2011
- Apr 12March was an eventful month around the world, and Wall Street definitely took notice. The conflict in Libya combined with the tsunami in Japan put upward pressure on crude oil prices, downward pressure on equity prices, and sent investors into the Treasury markets for cover.The retail market for corporate bonds responded to the events mostly as expected. Spreads widened temporarily and buying activity increased.
March 2011 Municipal Market Transparency Report: February 2011
- Mar 04In February the retail market for municipal bonds began to quiet down a bit from the frenzied pace of the past few months. Trading volumes were still elevated compared to the levels in October, but investor demand steadily decreased throughout February and selling activity also retreated a bit from its January peak. Corporate Market Transparency Report: February 2011
- Mar 04February was a volatile month on Wall Street, but the retail market for corporate bonds held steady. Yields and trade volumes both fell a bit, but investor sentiment continued to improve. The ratio of buys to sells increased for the third month in a row (from 1.2 to 1.3) indicating that investors are becoming less bearish.
February 2011 Corporate Market Transparency Report: January 2011
- Feb 08January was another bullish month on Wall Street. Stocks rallied, corporate bond spreads fell, and Treasuries held steady. The net result was lower corporate yields, but retail investors were not deterred. Buying volumes increased 17% in January. Municipal Market Transparency Report: January 2011
- Feb 08The muni market was bustling in January. Trade volumes were elevated for a third consecutive month, as aggressive retail investors attempted to capitalize on yields that have been increasing since November. Of course there was a lot of selling activity, too, as nervous investors fretted about the fiscal health of the public sector.
January 2011 Market Transparency Report: December 2010
- Jan 07Wall Street was brimming with holiday cheer during December. The Santa Clause Rally triggered a selloff in Treasuries, raising yields 50bps during the first half of the month. The increase flowed through to the retail corporate bond market, where yields rose for the second straight month. But individual investors remained unimpressed, and buying activity was lower than average in December. How Many Bonds?
- Jan 03Managing credit risk is among the most difficult challenges facing investors who buy individual corporate bonds. This paper attempts to determine how many bonds are necessary in a portfolio to prevent severe losses in the event of default. The results of our analysis indicate that as few as ten bonds are sufficient to gain a substantial portion of the maximum diversification benefits that can be achieved.
December 2010 The Cost of Waiting for Interest Rates to Rise
- Dec 15Today’s interest rate environment presents investors with a conundrum - do I stay on the sidelines and wait for rates to rise before re-allocating my fixed income portfolio, or do I jump in now....what are the costs of waiting for rates to rise? This paper evaluates this question in the context of income-matching portfolios constructed with individual bonds. (NOTE: This paper was written by Asset Dedication, an RIA affiliated with BondDesk.)
Market Transparency Report: November 2010
- Dec 07November was an action-packed month in the credit markets, including the QE2 announcement, the Irish debt crisis, and a muni bond meltdown. Ultimately the chaos led to an increase in yields in the corporate bond markets, but retail investors still weren't buying. In fact, there were nearly as many 'sell' trades in November as there were 'buy' trades, which is the first time that's happened all year.
November 2010 Market Transparency Report: October 2010
- Nov 05October was a month of anticipation on Wall Street as the markets tried to estimate the impact of both the November elections and, more importantly, the Fed’s QE2 decision. Early in the month institutional traders bet big on QE2, pushing yields to their low point for 2010. But by mid-month the rally stalled and yields headed back up. Meanhwile, during October corporate yields continued their downward slide.
October 2010 Market Transparency Report: September 2010
- Oct 07September was a tale of two halves. The first half was brimming with optimism, prompting a Treasury selloff that briefly raised yields across the curve. The second half was a return to the anxiety of August, dropping yields back to their September lows.
September 2010 Retail Bond Portfolios: Credit Risk Insights
- Sep 30New analysis by BondDesk Group shows that retail portfolios containing as few as ten investment grade corporate bonds can provide sufficient diversification to protect against extreme losses. Market Transparency Report: August 2010
- Sep 10August was a nervous month in the retail credit markets. Cautious comments by Ben Bernanke triggered fears of a “double dip” recession, and the markets reacted accordingly.
August 2010 Market Transparency Report: July 2010
- Aug 13July was a relatively uneventful month in the retail fixed income markets. As the BP crisis faded into the background, trading activity and yields both returned to a state of normalcy.
July 2010 Market Transparency Report: June 2010
- Jul 23June was a busy month in the retail fixed income markets. British Petroleum took center stage, as investors overwhelmingly chose to become buyers rather than sellers of BP bonds.