FIIG’s recent initiative to significantly improve transparency in the over-the-counter bond market by issuing daily prices on commonly traded bonds has generated a significant amount of positive reaction in the media
On Wednesday the Australian Financial Review, Smart Investor reported the news stating:
FIIG Securities sought to remedy [the lack of transparency of the OTC market] by rolling out a daily reporting function on commonly traded bonds.
Money Management, commented last week:
The move addresses critics of the over-the-counter (OTC) market who have complained that it is not as transparent as it could be, especially when compared to the Australian Securities Exchange (ASX).
FIIG chief executive, Mark Paton, said it would improve investor confidence that they were getting good value in the OTC market.
Australian Banking and Finance, also published a note last week, quoting Mark Paton, CEO:
"This step towards greater transparency will further reinforce the supremacy of the OTC market as the natural home of fixed income securities including bonds, just as it is for other financial assets such as foreign exchange,” said Paton.
"Additionally, it will mitigate the main advantage enjoyed by the ASX - transparency – while the ASX’s disadvantages for bond investors, including a severely restricted range of bonds, tiny volume and low liquidity remain."
Note: The bond rate sheet is published daily and uses FIIG’s observations from the previous trading day on the institutional mid-point price for commonly traded bonds. It can be found on the homepage of The WIRE website.