bonds (Treasuries) Government agency bonds Municipal bonds Corporate bonds Mortgage-backed securities Asset-backed securities High-yield bonds Supranational bonds Sovereign bonds Federal government Government-sponsored organizations and agencies Local authorities (states, counties, cities, etc.) Corporations Agencies, corporations Agencies, corporations Corporations Organizations such as World Bank, International Monetary Fund Government bonds issued in foreign markets Lehman indexes are rule-based. This top-down approach to index construction tends to produce indexes that are unbiased and very representative of their respective markets. Country weights in the Lehman index are presented in Table 8.8. Second, bonds, unlike common stock, are issued by a variety of entities such as governments, corporations, or agencies. They can be securities or not, and can have different provisions. For instance, Lehman Global Aggregate index consists of nearly 46 percent government bonds, about 17 percent corporate credit, and approximately 22 percent mortgage-backed securities. It also contains agency bonds, local authority and local agency bonds, and sovereign bonds. (See Figure 8.3.) Its average duration is 4.83 and its average maturity is 7.26 (as of May 31,2002). TABLE 8.8 Country Weights in Lehman Global Aggregate Index     Weight in   Weight in Country Index Country Index Austria 0.83% Spain 1.96% Belgium 1.21 Sweden 0.66 Denmark 0.50 Switzerland 0.13 Finland 0.37 United Kingdom 3.46 France 5.26 Hong Kong 0.08 Germany 9.17 Japan 18.35 Greece 0.64 Singapore 0.18 Ireland 0.15 Australia 0.41 Italy 4.66 New Zealand 0.07 Luxembourg 0.15 Canada 1.77 Netherlands 1.92 United States 44.26 Norway 0.15 Supranational 1.75 Portugal 0.37 Emerging markets 1.52