Capital Market Exchange’s Analysis Shows Slowed Issuance Increases Credit Risk in Some Sectors More

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Expanding on its most recent analysis of investor views, the company considered issuance activity.

Capital Market Exchange aggregates and tests the most widely shared factors driving corporate credit risk. Expanding on its most recent analysis of investor views, the company considered issuance activity. Sarah Biller, President of Capital Market Exchange, noted many investment teams “recognize factors influencing current spreads extend beyond traditional credit metrics. Our work with well-regarded firms reveals relative value strategies that consider behavioral influences and consensus data in addition to rigorous fundamental analysis. One important question is how to value investment grade companies tapping the credit markets in near and uncertain times.”

Until most recently, Capital Market Exchange observed issuance in the corporate bond market had slowed dramatically even as many companies face a near-term need to access the capital markets. Some recent reports suggest that a combination of global volatility, risk aversion and an imminent funding crunch sets the stage for a credit market on the precipice. Now, it appears some high grade companies have found the window of opportunity.

Capital Market Exchange's analysis of consensus factors from active fixed income investors over the past three years consistently shows declines in operating income or cash flow to be leading indicators of increased credit risk. Capital Market Exchange's reports its analysis reveals a less obvious conclusion: the impact of issuance-related risk is stratified by industry. The company reports issuers most impacted by deteriorating operating capital for bonds maturing in the next year to eighteen months come from three sectors: Basic Materials, Exploration and Production and Industrials.

About Capital Market Exchange Inc.: Capital Market Exchange (CMX) provides its network of leading institutional asset managers a structured approach to identify investment opportunities in the $90 trillion dollar global Fixed Income marketplace. CMX quantifies factors driving bond spreads and generates a market consensus for debt instruments. The analytics provide outputs on the relative value of bonds by sector and issue among other outputs. The results are proprietary to subscribers, yet the process is scalable to other asset classes. The results from its analysis and sophisticated decision support tools enable it to provide its clients actionable insights in the largest segment of the capital markets, yet one that remains relatively fragmented and opaque. More information may be found at

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