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  • Writer's pictureJohn Shelburne

Unraveling the Bond Market: Exploring FINRA TRACE Volumes


In the world of finance, trading volumes can reveal important trends and insights into the market. And the data sets from FINRA TRACE system provides some interesting findings. The monthly volumes for high grade and high yield bonds in US dollars have been rounded up to the nearest million for ease of reading.


Looking at the data, we can see that the TRACE High Grade Volume has been steadily increasing since January 2018, with a peak in March 2022 at 654 million dollars. Meanwhile, the TRACE High Yield Volume has shown a more fluctuating pattern, with its highest point occurring in March 2020 at 296 million dollars.


The TRACE system, established by the Financial Industry Regulatory Authority (FINRA), is an electronic reporting system that provides investors with information about bond transactions. All corporate bond trades in the US are required to be reported to the TRACE system, providing a comprehensive view of the market.


The recent data set highlights the increasing importance of high grade bonds in the market, with their trading volumes consistently surpassing those of high yield bonds. This is likely due to high grade bonds being less risky and offering lower yields, making them a safer investment option in a volatile market.

Overall, the FINRA TRACE system plays a critical role in ensuring transparency and providing valuable information to investors. And as we continue to analyze these trading volumes, we can gain a deeper understanding of the current state and future trends of the bond market.

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