SOURCE: Zions Direct

Zions Direct

November 17, 2010 09:54 ET

Zions Direct Announces Auction Results

Auctions of Municipal and Corporate Bonds for Week Ending November 12, 2010

SALT LAKE CITY, UT--(Marketwire - November 17, 2010) - Zions Direct (www.zionsdirect.com), the online broker-dealer that allows its customers to purchase municipal bonds and corporate bonds in its daily web-based auctions, announces their weekly auction results. In auctions closed from November 8, 2010 to November 12, 2010, investors purchasing municipal bonds in the auctions received average tax-exempt yields 0.59 percentage points, or 59 basis points, higher than similar bonds as reported by the Municipal Securities Rulemaking Board (MSRB). Customers that purchased corporate bonds in the auctions received average taxable yields 72 basis points higher than comparable bonds reported in FINRA's Trade Reporting and Compliance Engine (TRACE).

Zions Direct, in conjunction with BondDesk Group LLC, regularly publishes a Market Snapshot for investors to help understand the current bond market, summarizing current weighted-average yields of investment-grade municipal and corporate bonds. Findings are compared against similar securities auctioned at Zions Direct Auctions (www.auctions.zionsdirect.com). Since February 2007, Zions Direct has auctioned over 750 million dollars in more than 1,750 fixed-income auctions.

ZIONS DIRECT / BONDDESK® MARKET SNAPSHOT

Municipal Bonds' Average Yields Trade Data (source: MSRB)
    2010 - 2011   2011   2012   2013   2015   2017   2020
Rating   < 9mo   1 yr   2 yr   3 yr   5 yr   7 yr   10 yr
AAA   0.48%   0.56%   0.74%   0.95%   1.50%   2.07%   2.80%
AA   0.54%   0.63%   0.84%   1.15%   1.59%   2.32%   2.96%
A   0.78%   0.94%   1.34%   1.77%   2.36%   3.02%   3.41%
BBB   0.98%   1.97%   2.23%   1.99%   3.16%   3.83%   4.55%
Insured AAA-AA   0.57%   0.64%   0.88%   1.25%   1.79%   2.30%   2.95%

 

Municipal Bond Auction Comparison Data (auction data from auctions.zionsdirect.com)
                     
Issuer   Term   Rating   Auction Yield   MSRB Avg Yield   Difference (basis points)
Elko Cnty, NV GO   1 Month   A   1.20%   0.78%   42
Florida St Turnpike Rev   20 Month   AA   1.35%   0.84%   51
Humble ISD, TX GO   3 Month   Insured AAA   1.17%   0.57%   60
Miami-Dade Cnty Sch Brd, FL COP   9 Month   A   1.40%   0.78%   62
Texas A&M Univ   6 Month   AA   1.10%   0.54%   56
So Brunswick, NJ GO   11 Month   AA   1.40%   0.63%   77
Massachusetts St GO   1 Month   AA   0.89%   0.54%   35
Seneca Valley PA SD   8 Month   AA   1.39%   0.54%   85
Average Difference                   59

 

Corporate Bonds' Average Yields Trade Data (source: FINRA's TRACE)
    2010 - 2011   2011   2012   2013   2015   2017   2020
Rating   < 9mo   1 yr   2 yr   3 yr   5 yr   7 yr   10 yr
AAA   0.20%   0.38%   0.57%   0.98%   1.62%   2.47%   3.11%
AA   0.46%   0.57%   1.12%   1.57%   2.23%   3.30%   3.68%
A   0.44%   0.81%   1.12%   1.97%   2.75%   3.85%   4.25%
BBB   0.75%   1.12%   1.83%   2.39%   2.98%   4.09%   4.41%

 

Corporate Bond Auction Comparison Data (auction data from auctions.zionsdirect.com)
            Auction   TRACE   Difference
Issuer   Term   Rating   Yield   Avg Yield   (basis points)
Caterpillar Fin Srvcs   1 Month   A   1.20%   0.44%   76
HSBC Finance Corp   5 Month   A   1.55%   0.44%   111
Toyota Motor   1 Month   AA   1.15%   0.46%   69
Eli Lilly   16 Month   A   1.41%   0.81%   60
Coca-Cola   4 Month   A   1.25%   0.44%   81
Pepsico Inc   18 Month   A   1.36%   1.12%   24
JP Morgan   3 Month   A   1.24%   0.44%   80
Average Difference                   72

For more information on Zions Direct and the BondDesk Market Snapshot go to www.zionsdirect.com to sign up to receive the free weekly newsletter or visit www.think.zionsdirect.com to view a Market Snapshot archive.

THE INFORMATION IN THE MARKET SNAPSHOT IS NOT INTENDED TO SERVE AS THE BASIS FOR INVESTMENT DECISIONS. PAST PERFORMANCE IS NOT AN INDICATION OF FUTURE RESULTS.

About Zions Direct

Zions Direct is a broker-dealer that specializes in offering securities for self-directed and fixed income-focused investors. Zions Direct allows retail investors to buy FDIC-insured certificates of deposit and corporate and municipal bonds through its web-based Bond Store (www.bondstore.com) and auction platforms. In addition, clients can invest in stocks, mutual funds, and exchange-traded funds online or through a Zions Direct financial representative.

About BondDesk Group LLC

BondDesk Group LLC is a financial technology firm, providing enterprise-wide fixed income solutions to many of the top broker-dealers in North America. The BondDesk Alternative Trading System (ATS), run by BondDesk Trading LLC, connects broker-dealers through a centralized marketplace by offering a diverse pool of liquidity for odd-lot fixed income securities in multiple asset classes. The BondDesk ATS executes over 20,000 transactions per day by providing 2,000 broker-dealers access to 35,000 live and executable offerings from over 100 premier fixed income dealers. In addition, BondDesk Group is a leading provider of innovative fixed income wealth management solutions, advisor workstations and fixed income analytical tools and applications.

Market Snapshot Information Disclaimer

MSRB and TRACE bond trade data displayed as weighted average yield. Municipal bond information from MSRB as of November 12, 2010. The Trade Data was developed by BondDesk Group based on information from MSRB's Real-Time Transaction Reporting System, and excludes transactions in taxable bonds. Auction information from auctions.zionsdirect.com as of November 12, 2010.

Corporate bond information from FINRA's Trade Reporting and Compliance Engine (TRACE) as of November 12, 2010. The Trade Data was developed by BondDesk Group based on trade reporting information from TRACE, and excludes transactions in callable and floating-rate coupon bonds. The aggregate rating for each bond is based on average ratings from Moody's and S&P (when available).

Although information in this Market Snapshot is believed to be reliable, Zions Direct and BondDesk make no express or implied warranties of any kind regarding this information, including as to its accuracy or completeness. Auction data excludes bonds in undersubscribed auctions.

Municipal bonds are exempt from federal tax and may or may not be tax-exempt in individual states. The inclusion of municipal bonds selected by tax-exempt status is generated from pertinent federal tax attributes as populated from Muller, IDC, and/or BD ATS data sources.

Terms are defined as follows: < 9 months = anything up to .75 years to maturity; 1 year = anything greater than 0.75 years up to 1.5 years to maturity; 2 years = anything greater than 1.5 years up to 2.5 years to maturity; 3 years = anything greater than 2.5 years up to 4 years to maturity; 5 years = anything greater than 4 years up to 6 years to maturity; 7 years = anything greater than 6 years up to 8.5 years to maturity; 10 years = anything greater than 8.5 years up to 11.5 years to maturity.

Investment products and services offered through Zions Direct, member of FINRA/SIPC, a non-bank subsidiary of Zions Bank are NOT insured by the FDIC or any federal or state governmental agency, are NOT deposits or other obligations of, or guaranteed by, Zions Bancorporation or its affiliates, and MAY be subject to investment risks, including the possible loss of principal value or amount invested. FDIC-insured CDs are insured up to $250,000 per individual account holder per bank.

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