Definition of Benchmark issues

Benchmark issues

Also called on-the-run or current coupon issues or bellwether issues. In the secondary
market, it's the most recently auctioned Treasury issues for each maturity.

Bellwether issues

Related:benchmark issues.

Current-coupon issues

Related: benchmark issues

Benchmark

The performance of a predetermined set of securities, for comparison purposes. Such sets may be
based on published indexes or may be customized to suit an investment strategy.

Benchmark error

Use of an inappropriate proxy for the true market portfolio.

Benchmark interest rate

Also called the base interest rate, it is the minimum interest rate investors will
demand for investing in a non-Treasury security. It is also tied to the yield to maturity offered on a
comparable-maturity Treasury security that was most recently issued ("on-the-run").

Customized benchmarks

A benchmark that is designed to meet a client's requirements and long-term
objectives.

Dual-currency issues

Eurobonds that pay coupon interest in one currency but pay the principal in a different
currency.

Euroequity issues

Securities sold in the Euromarket. That is, securities initially sold to investors
simultaneously in several national markets by an international syndicate. Euromarket.
Related: external market

New-issues market

The market in which a new issue of securities is first sold to investors.

Posttrade benchmarks

Prices after the decision to trade.

Pre-trade benchmarks

Prices occurring before or at the decision to trade.

Sharpe benchmark

A statistically created benchmark that adjusts for a managers' index-like tendencies.

Small issues exemption

Securities issues that involve less than $1.5 million are not required to file a
registration statement with the SEC. Instead, they are governed by Regulation A, for which only a brief
offering statement is needed.

Specific issues market

The market in which dealers reverse in securities they wish to short.

Benchmark

A standard by which something may be compared and measured

benchmarking

the process of investigating how others do something better so that the investigating company can imitate,
and possibly improve upon, their techniques

process benchmarking

benchmarking that focuses on practices and how the best-in-class companies achieved their results

results benchmarking

benchmarking in which an end product or service is examined; the focus is on product/service specifications and performance results

Emerging Issues Task Force (EITF)

A special committee of the Financial Accounting Standards Board established to reach consensus of how to account for new and unusual financial transactions that have the potential for creating differing financial reporting practices.

Emerging Issues Task Force (EITF)

A separate committee within the Financial Accounting Standards Board composed of 13 members representing CPA firms and preparers of financial statements
whose purpose is to reach a consensus on how to account for new and unusual financial transactions
that have the potential for creating differing financial reporting practices.

Agency basis

A means of compensating the broker of a program trade solely on the basis of commission
established through bids submitted by various brokerage firms. agency incentive arrangement. A means of
compensating the broker of a program trade using benchmark prices for issues to be traded in determining
commissions or fees.

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