2010년 12월 26일 일요일

Asia's Bond Risk Increases, Credit-Default Swap Prices Show

The cost of protecting corporate and sovereign bonds in Asia from default climbed, according to Markit Group Ltd. prices.

The Markit iTraxx Asia index of 50 investment-grade borrowers outside Japan rose 1 basis point to 104 basis points as of 8:00 a.m. in Hong Kong, Markit prices show.

The Markit iTraxx Japan index was little changed at 103 basis points as of 9:21 a.m. in Tokyo. The Markit iTraxx Australia index was unchanged at 104 basis points as of 11:00 a.m. in Sydney, Markit
prices show.

Credit-default swap indexes are benchmarks for protecting bonds against default and traders use them to speculate on credit quality. A drop signals improving perceptions of creditworthiness, while an increase suggests the opposite.

The swap contracts pay the buyer face value in exchange for the underlying securities if a borrower fails to meet its debt agreements. A basis point is 0.01 percentage point.

To contact the reporter on this story: Jungmin Hong in Seoul at jhong47@bloomberg.net
To contact the editor responsible for this story: Tom Kohn at tkohn@bloomberg.net.
 

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