Sources: Data as of 6/30/13, Primary: Securities Industry and Financial Markets Association (SIFMA), S&P Capital IQ, A part of McGraw Hill Financial, Bank for International Settlements (BIS), Fitch Ratings, Inc., Fitch Ratings Ltd. and its subsidiaries, S&P Dow Jones Indices LLC, a part of McGraw Hill Financial, Investment Company Institute, U.S. Department of the Treasury, Bureau of the Fiscal Service. Secondary: Over twenty-five investment industry, research, and media sources. Percentages and totals are estimated due to rounding. Keys: Other (MM=US Money Market, ABS= US Asset Backed Security, MUNI= US Municipal Bond). Conv/Pref = US Convertible and Preferred. Preferred values only, as of 9/30/13. Source data is available by request to contact@7Twelveadvisors.com. Use of this research is permitted for non-commercial purposes only with proper citation as 3Twelve Total World Bond™ with inclusion of primary sources.
The 3Twelve Total World Bond™ map may be the most complete compilation of world bond totals available. We are delighted to publish this exclusively with LearnBonds — the most comprehensive source for fixed-income.
The 3Twelve Total World Bond™ map is more than an aggregate bond inventory. Maps, for example, have cardinal directions or points on the compass: north, south, east, and west. These are important because directions create perspective. Our “cardinal directions” are the 3 types of bond borrowers: governments, corporations, and individuals (mortgages). To further the analogy, political maps show boundaries between countries, states, and cities. Our “boundaries” are the Twelve major bond categories such as US Treasurys, Non-US Corporate, and Federal Agencies. This is why we call it 3Twelve.
Another important association with a map is that our intent is to help investors find their way. Each of the Twelve major categories is important for investors and is a necessary contributor to a diversified portfolio.
Maintaining an accurate world bond total is virtually impossible for many reasons: 1) Bonds are the largest investment asset class and have almost double the monetary value of stocks, 2) Bonds do not have a perpetual life like stocks, so values constantly change, 3) Individual bond issues count in the millions, whereas stocks count only in the thousands, 4) Many bonds are privately traded and are never published on any exchange, 5) Even global clearinghouses like the Bank for International Settlements stated that they recently changed their calculation methodology because of difficulty of accurate estimating, 6) New issues of bonds are published, redemptions are not, 7) Bonds, Debt, and Loans are often mis-categorized, e.g., debt securities are always loans, but loans are not always debt securities, and 8) The primary sources that we cite report accurate data, however, secondary sources such as investment firms, banks, traders, investment advisors, and the financial press often unintentionally misinterpret this data. Because of this, we have at least triple-verified every data point with over twenty authoritative sources.
Mapmakers say there is no such thing as a finished map. Cities change names, populations grow, borders are redrawn, etc. Likewise the 3Twelve Total World Bond™ map will never be finished and will be frequently revised and updated.
–Andrew D. Martin (special thanks to Dalton Easterwood, research assistant, 7Twelve Advisors, LLC)