Fixed Income

FINRA plays an important role in regulating and providing transparency to the fixed income securities markets. For example, we operate and enforce FINRA rules regarding the Trade Reporting and Compliance Engine (TRACE®), and enforce, for our member firms, federal securities regulations governing fixed income, including those promulgated by the Securities and Exchange Commission (SEC) and Municipal Securities Rulemaking Board (MSRB).

Most recently, the SEC designated FINRA as the examination and enforcement authority for municipal advisors that are FINRA members. Firms selling municipal securities or performing municipal advisory services must register with the MSRB.

FINRA Member Regulation is responsible for examining all FINRA members involved in the fixed income markets for compliance with applicable rules and regulations. Among other things, Member Regulation reviews firms' fixed-income sales practices to determine whether they have dealt fairly with customers and that their registered representatives are properly qualified and supervised, and ensures they are in compliance with net capital requirements.

Market Regulation, meanwhile, monitors trading activity in more than 2.5 million individual debt securities, including corporate bonds, municipal securities, government agency securities, U.S. Treasury Securities and mortgage- and asset-backed securities, for potential manipulative activity and to ensure customers receive fair prices.

Trade Reporting and Compliance Engine (TRACE)

TRACE, introduced in 2002, captures real-time consolidated transaction data for all eligible public and private (144A) corporate bonds—including investment grade, high yield and convertible debt—agency debt and U.S. Treasury Securities. Securitized products, such as mortgage-backed securities (MBS), traded in specified pool or To Be Announced (TBA) transactions also are part of the TRACE system.

As a result, TRACE brings transparency to the bond market. Individual investors and market professionals can access information on all over-the-counter (OTC) public and private activity representing more than 99 percent of total U.S. corporate bond debt, more than 16,000 agency debt securities, and more than one million asset and mortgage-backed securities.

FINRA licenses TRACE data to TRACE vendors and subscribers. The TRACE Content Licensing section provides information about data licensing options, agreements, technical specifications, and market data policies.

Learn more about TRACE

Contact FINRA

FINRA's Fixed Income Regulation (FIR) staff provides broker-dealers, attorneys, registered representatives, investors and other interested parties with guidance relating to FINRA’s enforcement of MSRB rules. 

FIR staff contacts:
Cynthia Friedlander and Bonnie Bowes
FINRA, Fixed Income Regulation
1700 K Street, NW
Washington, DC 20006
(202) 728-8000

  • Regulatory Notice 17-24
    FINRA Issues Guidance on the Enhanced Confirmation Disclosure Requirements in Rule 2232 for Corporate and Agency Debt Securities
    07/12/2017
  • Regulatory Notice 17-08
    SEC Approves Amendments to Require Mark-Up/Mark-Down Disclosure on Confirmations for Trades With Retail Investors in Corporate and Agency Bonds
    02/15/2017
  • Regulatory Notice 15-46
    Guidance on Best Execution Obligations in Equity, Options and Fixed Income Markets
    11/20/2015
  • Regulatory Notice 15-36
    FINRA Requests Comment on a Revised Proposal Requiring Confirmation Disclosure of Pricing Information in Corporate and Agency Debt Securities Transactions
    10/12/2015
  • Regulatory Notice 15-31
    SEC Approves Rule to Address Conflicts of Interest Relating to the Publication and Distribution of Debt Research Reports
    08/26/2015
  • Regulatory Notice 15-27
    Guidance Relating to Firm Short Positions and Fails-to-Receive in Municipal Securities
    07/30/2015
  • Regulatory Notice 15-03
    FINRA Requests Comment on Proposal to Require Alternative Trading Systems to Submit Quotation Information Relating to Fixed Income Securities to FINRA for Regulatory Purposes
    02/06/2015
  • Regulatory Notice 10-41
    FINRA Reminds Firms of Their Sales Practice and Due Diligence Obligations When Selling Municipal Securities in the Secondary Market
    09/20/2010
  • Regulatory Notice 09-35
    FINRA Recommends Review of Municipal Securities Activities
    06/30/2009
  • Notice to Members 06-36
    NASD and NYSE Joint Interpretive Guidance on Fixed Income Research
    07/31/2006
  • Investor Insights
    Spread the Word: What You Need to Know About Bond Spreads
    The difference between the yields of two different bonds, called a bond spread, can help you understand the potential risks and rewards for investing in a particular bond. Corporate bonds are often measured against relatively risk-free Treasury bonds. Bond spreads can also help you evaluate the overall health of the economy.
  • Investor Education
    What Is TRACE and How Can It Help Me?
    When securities are listed on a centralized exchange, such as the New York Stock Exchange or Nasdaq, transaction information such as price and trade history is readily available to investors through the exchange. But how can you get information about bonds and other fixed income securities that are not listed on a national securities exchange? Information about these securities, known as over-the-counter (OTC) debt securities, is provided by TRACE®—the Trade Reporting and Compliance Engine®.
  • Investor Insights
    Know the Facts About Direct Registered Shares
    As an individual investor, there are several ways in which you can hold securities, including through direct registration. Direct registration allows you to have your securities registered in your name—rather than in the name of a brokerage firm—without the need for a physical certificate.
  • Investor Insights
    The One-Minute Guide to Zero Coupon Bonds
    Most bonds make regular interest or "coupon" payments—but not zero coupon bonds. Zeros, as they are sometimes called, are bonds that pay no coupon or interest payment. With a zero, you buy the bond at a discount from the face value of the bond and are paid the face amount when the bond matures.
  • Investor Insights
    Brush Up on Bonds: Interest Rate Hikes and Duration
    Do you own bonds or have money invested in a bond fund? If so, now is a good time to brush up on two factors that can drag down bond prices and fund returns—interest rate hikes and a bond's duration.
  • Investor Insights
    Insurance-Linked Securities
    Where there is uncertainty, there are always bets—the question is who wins. From horse racing to the price of gold, people have always speculated on uncertainty. Insurance-linked securities (ILS) are financial instruments that allow investors to speculate on a variety of events, including catastrophes such as hurricanes, earthquakes and pandemics.