posted on 06-06-2019

Automated Bond System (ABS)

Updated August 7, 2020

What is an Automated Bond System (ABS)?

The Automated Bond System (ABS) is a computerized platform that tracks the prices for inactive bonds on the New York Stock Exchange (NYSE).

How Does an Automated Bond System (ABS) Work?

Many bonds on the NYSE do not experience much price movement due to exceptionally low volume levels. As a result, the market is practically non-existent. The Automated Bond System automatically records any and all movements in the bid and ask prices for inactive bonds until they are bought, sold, or canceled.

Why Does an Automated Bond System (ABS) Matter?

Though rarely traded, inactive bonds are still valid for sale and purchase. The ABS ensures that the purchase and sale prices for inactive bonds are available for potential investors.