Merrill Lynch has chosen FT Interactive Data as the primary independent provider of evaluated pricing for the Merrill Lynch Global Bond Indices.
FT Interactive Data prices are currently used by Merrill Lynch to value the vast majority of the constituents in Merrill Lynch’s US high grade, high yield and emerging markets bond indices. FT Interactive Data’s prices are also used in the calculation of the Merrill Lynch Canadian Bond Indices, and the two firms are now seeking to expand their working relationship into other non-dollar markets.
“In the 1990s, investors began to demand greater transparency in their benchmark indices – an area where Merrill Lynch has always scored well given the open architecture of its Bloomberg – and web-based delivery platforms. Today, investors are equally interested in knowing that the valuation process is independent of the compilation agent’s own trading activities,” says Phil Galdi, managing director of the firm’s global index team. “Our goal, working with FT Interactive Data, is to increase the percentage of our global universe that is independently evaluated to as close to 100% as possible.”
Within the North American series of Indices, Merrill Lynch’s flagship US High Yield and High Grade Corporate Bond Indices are both compiled entirely on the basis of prices provided by FT Interactive Data.
With this expanded agreement, Merrill Lynch will now be using independent evaluated prices for 80% of the entire Merrill Lynch Global High Grade Bond Index universe, and 90% of the entire Global High Yield & Emerging Markets Index universe, which together consist of more than 24,000 securities.