Corporate Cost of Funding Research Report

Overbond Research

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"Overbond Ltd., the first end-to-end fixed income markets fintech platform for AI predictive analytics, has launched COBI Pricing, a new proprietary bond pricing and liquidity risk management automation solution. COBI (Corporate and Government Bond Intelligence) is a comprehensive..." Read More ("Overbond Ltd., the first end-to-end fixed income markets fintech platform for AI predictive analytics, has launched COBI Pricing, a new pro)

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Overview

Overbond research team compared the cost of funding implications for an investment grade issuer using four different debt portfolio issuance strategies. The data utilized includes all U.S. treasury rates and generic “BBB” index spreads from 2002 to 2016. In aggregate, there are over 7,000 unique data points. The analysis concludes that issuing debt on a more frequent basis and in smaller issuance sizes has been shown to lower the average cost of borrowing and better diversify investor base.

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At a Glance

The ability to issue on a more frequent basis and in smaller issuance sizes could be achieved through a less manually intensive primary bond issuance process. Fintech platforms such as Overbond reduce manual inputs and result in more attractive economics for both issuers and dealers.