The dealer must maintain competitive pricing since the dealer is selling the same line of goods as his or her principal competitors. Ask for details about a financial advisor's book, such as how many clients there are, the size of assets, and the number of sales assistants. Therefore there are two factors at work here. The transfer price will vary from one investment dealer to another and is a function of the philosophy and structure of that organization. This is why it is important to ask about a firm's philosophy as to whether or not the retail desk is master of its own destiny or has to pay the wholesale desk something.
Word spreads when a broker has the best prices around.
The corollary is that a broker facing a higher transfer price may have to reduce his or her mark-up in order to remain competitive and thus face lower earnings. It may have a very high or low coupon, it may be a small illiquid issue, its ownership may be concentrated in few hands or it may have a feature or features which make it unattractive to trade. Whatever the scenario, the bid-ask spread will be wider for such an issue, because dealers either do not wish to hold them in inventory or if they do, find it difficult to sell them quickly. Benchmark refers to bonds by which others are valued. In so doing, these bonds issues become sizeable enough that they trade freely with tight bid-offer spreads.