The wide variability of liquidity among corporate bonds studied by Fitch Ratings, based on a sample from five of the largest U.S. corporate bond exchanged-traded funds (ETFs), could pose risks for the corporate bond market, according to a report published today.

Fitch surveyed the underlying bond trading activity for five of the largest U.S. investment grade corporate bond ETFs. The study looked at three distinct segments of the ETFs' holdings with a focus on measures of liquidity that differ as the size of the issues change. Trading frequency and volume varied significantly across individual issues held by the ETF, during the four month study period, as 54% of the largest holdings traded daily while only 5% of issues from a smaller cohort traded daily.

Fitch believes this represents a risk not just for ETFs but for all fixed income investors facing price pressure during periods of prolonged volatility. The wide variability in trading frequency and corporate debt issues is particularly relevant to investors or structures that may need to sell debt securities in certain circumstances.

The full report 'Corporate Bond Liquidity: A Look Below the Surface' is available at 'www.fitchratings.com.'

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research: Corporate Bond Liquidity: A Look Below the Surface

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=833328

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Fitch RatingsMedia Relations:Brian Bertsch, +1 212-908-0549brian.bertsch@fitchratings.com