Retail investors are on the hunt for fixed-income products with decent yields, but the bond market for individual investors is often opaque, making it hard for financial advisers to get a keen sense of what these investors are thinking.
Thus, BondDesk, a fixed-income trading and technology firm, is setting out to clarify the workings of the retail bond market in a service it rolled out Oct. 12. BondDesk Market Transparency Report is a free service that offers monthly reports on corporate bond trading activity among retail investors.
The BondDesk Market Transparency Report aggregates all the data for trades in batches of 100 bonds or less. In doing so, BondDesk said, it is hoping to give advisers insight into which corporate bonds are hot, trading volume for individual issuers and whether bond issues bought by individual investors are priced competitively.
The service features a listing of current offerings on the BondDesk platform by asset class, the most active corporate issuers and a yield matrix. BondDesk is hoping that advisers will find its yield matrix particularly useful, according to Chris Shayne, the director of Mill Valley, Calif.-based BondDesk Group.
Retail bond trades are much smaller than institutional transactions, which can typically happen in batches of one million or more.
Consequently, retail bond trades incur higher unit transaction costs, Shayne said, and their yields are slimmer.
The BondDesk Group is already a name familiar to independent advisers and those who work at brokerage firms. BondDesk attracts about 100 contributing dealers, which provide about 35,000 live and executable offerings to 2,000 broker-dealers.
The company tracks almost 12,000 unique corporate bonds and executes more than 20,000 transactions a day.
All of this, it says, gives the company and its clients a more robust picture of the retail bond market and creates a stable benchmark for judging the prices of individual bonds.
"We focus on retail because it is our bread and butter," Shayne said. "If advisers need to know what's going on in the retail market, we know exactly what the trading activity is."
