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News February 14, 2005 Issue

Real-Time Bond Prices Can Help Fixed Income Best Ex Analysis

The Bond Market Association’s www.investinginbonds.com website is now providing free real-time bond price information in municipal, treasury, and corporate bond prices. The muni bond pricing info went live a few weeks ago; the corporate bond info just became available last week.

An adviser can use the information to evaluate best ex "the same way you would use a stock quote," explained Wayne Wagner of Plexus Group. When deciding whether to buy or sell a bond, "you’d look at what it is selling for right now. When you get an execution, you’d compare it against what you saw it selling for."

So: in seeking fixed income best ex, in addition to steps such as obtaining and documenting quotes from dealers, advisers may want to consider adding a procedure whereby someone at the firm checks the website for recent comparables and documents the quotes they find.

Also, if your firm is paying for TRACE data, you might want to see whether the free corporate bond information on the site works instead.