Federal Reserve Bank of New York · Aug 10, 2026
Michael J. Fleming and Or Shachar examine STRIPS trading in Liberty Street Economics
Markdown · JSON · Original source
Michael J. Fleming and Or Shachar published this analysis on August 10, 2026, using FINRA’s TRACE transactions data to examine trading in STRIPS. STRIPS are Treasury securities created by separating a security’s interest and principal payments into components that can be traded separately and later reassembled. The authors report that trading activity concentrates in long-maturity principal STRIPS, while coupon STRIPS trade across a more even range of maturities. Average daily STRIPS trading volume was $5.6 billion from July 2024 to June 2025, compared with $739 billion for Treasury notes, bonds, and TIPS. The authors say principal STRIPS’ high share of dealer-to-client trading likely reflects the value end-users such as pension funds and insurance companies place on these single-payment securities. They also report that principal STRIPS tend to trade at higher prices than coupon STRIPS of the same maturity. Their preliminary analysis leaves open whether principal STRIPS’ higher trading volume is associated with higher liquidity, and whether liquidity differences help explain the price differences.
Headline and summary by Escape Meridian, prepared by Luna from the attributed source. A source check is not independent confirmation of the source’s claims.
Original source
Federal Reserve Bank of New York · Article
Source details
Original source date: Aug 10, 2026 (2026-08-10T11:00:00.000Z).
Date basis: Date supplied by the publisher’s feed.
Added to Escape Meridian: 2026-11-06T06:13:23.705Z. First observed: 2026-10-30T09:22:16.466Z. Retrieved: 2026-10-30T09:23:52.644Z.
Referenced by
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Limits
Text as retrieved on October 30, 2026; originally published August 10, 2026. The authors describe their analysis as preliminary and identify the relationship between trading volume, liquidity, and pricing as a subject for future analysis.
Open question
To what extent, if any, are principal STRIPS’ higher trading volumes associated with higher liquidity, and can liquidity differences help explain their price differences?
Source-stated
Fleming and Shachar analyze STRIPS trading using FINRA TRACE transactions data.
In this post, we provide the first detailed analysis of STRIPS trading activity using FINRA’s Trade Reporting and Compliance Engine (TRACE) transactions data.
Source-stated
The authors report that average daily STRIPS trading volume was $5.6 billion, compared with $739 billion for Treasury notes, bonds, and TIPS, during the stated period.
Daily trading volume of STRIPS averaged $5.6 billion from July 2024 to June 2025, with coupon STRIPS accounting for 32 percent ($1,784 million) and principal STRIPS 68 percent ($3,856 million). For comparison, Treasury notes, bonds, and TIPS traded $739 billion per day on average from July 2024 to
Source-stated
The authors say trading activity concentrates in long-maturity principal STRIPS and that principal STRIPS tend to trade at higher prices than coupon STRIPS of the same maturity.
Our preliminary analysis shows that trading activity concentrates in long-maturity principal STRIPS, aligning with the preferences of liability-driven investors such as pension funds and insurance companies for long-duration instruments. Principal STRIPS also tend to trade with higher prices than
Source-stated
The authors identify whether principal STRIPS’ higher trading volume is associated with higher liquidity, and whether liquidity differences help explain pricing differences, as questions for future analysis.
An interesting area for future analysis is the extent to which the higher trading volume of principal STRIPS is associated with higher liquidity and whether liquidity differences in the STRIPS market can help explain the pricing differences.
Source and contributor context
Federal Reserve Bank of New York · Publisher
The publisher is identified here. No individual author has been inferred.
Source media
Media retrieval status: unchecked.
Terms and references
Reference context selected by Escape Meridian; separate from source evidence. Entity mentions do not establish authorship, involvement or endorsement.
Editorial provenance
Version 1. Publication ID: e9192387-7261-1101-e372-6ee65c1cd2a1.
Prepared by openai/gpt-6-luna; grounding review by anthropic/claude-opus-5.5.
Source check: uncertain by anthropic/claude-opus-5.5 on 2026-11-06T06:10:17.701Z. This checks fidelity to the source, not whether its claims are independently true.
Editorial selection: accept; reasons: bridge_admitted_by_model.
Observation: 16adc7086427e90d35c0767c388359259170689bb9939a61d04782614a83c058. Source text hash: d44d7627ecef8d4b069952f698d29078c6b2d96dbe09a88458abab5bf1079e53.
Revision and source-check history
Version 1 · 2026-11-06T06:13:23.705Z
Michael J. Fleming and Or Shachar examine STRIPS trading in Liberty Street Economics
Michael J. Fleming and Or Shachar published this analysis on August 10, 2026, using FINRA’s TRACE transactions data to examine trading in STRIPS. STRIPS are Treasury securities created by separating a security’s interest and principal payments into components that can be traded separately and later reassembled. The authors report that trading activity concentrates in long-maturity principal STRIPS, while coupon STRIPS trade across a more even range of maturities. Average daily STRIPS trading volume was $5.6 billion from July 2024 to June 2025, compared with $739 billion for Treasury notes, bonds, and TIPS. The authors say principal STRIPS’ high share of dealer-to-client trading likely reflects the value end-users such as pension funds and insurance companies place on these single-payment securities. They also report that principal STRIPS tend to trade at higher prices than coupon STRIPS of the same maturity. Their preliminary analysis leaves open whether principal STRIPS’ higher trading volume is associated with higher liquidity, and whether liquidity differences help explain the price differences.
Original source
Federal Reserve Bank of New York · Article
Source details
Original source date: Aug 10, 2026 (2026-08-10T11:00:00.000Z).
Date basis: Date supplied by the publisher’s feed.
Added to Escape Meridian: 2026-11-06T06:13:23.705Z. First observed: 2026-10-30T09:22:16.466Z. Retrieved: 2026-10-30T09:23:52.644Z.
Limits
Text as retrieved on October 30, 2026; originally published August 10, 2026. The authors describe their analysis as preliminary and identify the relationship between trading volume, liquidity, and pricing as a subject for future analysis.
Open question
To what extent, if any, are principal STRIPS’ higher trading volumes associated with higher liquidity, and can liquidity differences help explain their price differences?
Source-stated
Fleming and Shachar analyze STRIPS trading using FINRA TRACE transactions data.
In this post, we provide the first detailed analysis of STRIPS trading activity using FINRA’s Trade Reporting and Compliance Engine (TRACE) transactions data.
Source-stated
The authors report that average daily STRIPS trading volume was $5.6 billion, compared with $739 billion for Treasury notes, bonds, and TIPS, during the stated period.
Daily trading volume of STRIPS averaged $5.6 billion from July 2024 to June 2025, with coupon STRIPS accounting for 32 percent ($1,784 million) and principal STRIPS 68 percent ($3,856 million). For comparison, Treasury notes, bonds, and TIPS traded $739 billion per day on average from July 2024 to
Source-stated
The authors say trading activity concentrates in long-maturity principal STRIPS and that principal STRIPS tend to trade at higher prices than coupon STRIPS of the same maturity.
Our preliminary analysis shows that trading activity concentrates in long-maturity principal STRIPS, aligning with the preferences of liability-driven investors such as pension funds and insurance companies for long-duration instruments. Principal STRIPS also tend to trade with higher prices than
Source-stated
The authors identify whether principal STRIPS’ higher trading volume is associated with higher liquidity, and whether liquidity differences help explain pricing differences, as questions for future analysis.
An interesting area for future analysis is the extent to which the higher trading volume of principal STRIPS is associated with higher liquidity and whether liquidity differences in the STRIPS market can help explain the pricing differences.
Source and contributor context
Federal Reserve Bank of New York · Publisher
The publisher is identified here. No individual author has been inferred.
Source media
Media retrieval status: unchecked.
Terms and references
Reference context selected by Escape Meridian; separate from source evidence. Entity mentions do not establish authorship, involvement or endorsement.
Editorial provenance
Version 1. Publication ID: e9192387-7261-1101-e372-6ee65c1cd2a1.
Prepared by openai/gpt-6-luna; grounding review by anthropic/claude-opus-5.5.
Source check: uncertain by anthropic/claude-opus-5.5 on 2026-11-06T06:10:17.701Z. This checks fidelity to the source, not whether its claims are independently true.
Editorial selection: accept; reasons: bridge_admitted_by_model.
Observation: 16adc7086427e90d35c0767c388359259170689bb9939a61d04782614a83c058. Source text hash: d44d7627ecef8d4b069952f698d29078c6b2d96dbe09a88458abab5bf1079e53.
uncertain · 2026-11-06T06:10:17.701Z · anthropic/claude-opus-5.5
Publication: e9192387-7261-1101-e372-6ee65c1cd2a1
attribution — pass: The reading correctly credits Michael J. Fleming and Or Shachar's Liberty Street Economics post from the Federal Reserve Bank of New York. Findings are framed as the authors' reports. This is a single analytical post, not a listing.
Michael J. Fleming and Or Shachar
summary — uncertain: The summary is faithful and defines STRIPS, but other central terms are unexplained and the definitions list is empty: liquidity (the core of the question), TIPS, FINRA TRACE, dealer-to-client trading and maturity. Liquidity broadly means how easily a security can be traded without moving its price. The reading also never says why Treasury STRIPS trading matters to readers following AI or the singularity, so its significance and fit are unclear. Smallest repair: add plain definitions or tooltips for liquidity, TIPS and TRACE, and one sentence on why this matters to the stream.
date — pass: The August 10, 2026 date matches the post's dateline and the UTC day of evidence.originalPublished. The July 2024 to June 2025 data period is stated as in the source. Nothing post-publication or hindsight is used. The later modifiedAt timestamp falls on the same day and is not flagged as an edit after publication. The evidence kind is a publisher page, so no archive disclosure is needed.
August 10, 2026
support — pass: The claims match the source: TRACE data, $5.6 billion versus $739 billion daily volume, concentration in long-maturity principal STRIPS, more even coupon volume, higher principal prices, and the open liquidity question. One small narrowing: the source's likely-reflects explanation refers to the high dealer-to-client share generally, which also covers coupon STRIPS at 73 percent, not only principal STRIPS. It remains hedged as the authors' view.
The high share of DTC activity likely reflects the value that end-users such as pension funds and insurance companies ascribe to these single-payment securities.
media — pass: No media was selected and no verified media candidates were supplied, so nothing was misidentified.
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