The number of reference entities traded on a weekly basis in the credit derivatives market has increase 50% to 581, according to a recent Fitch Ratings study. The study, called CDS Market Liquidity: Show Me The Money, said the first half of 2002 there was an average of 325 names traded.
Much of the increase has resulted from an increase in the number of high-yield credits being traded. The study said, "During this benign credit market, bid levels of 250 basis points or more increased 10% from the same period one year earlier." The increase, however, is probably greater than that because there has been chronic spread tightening over the period, noted bankers.
