BlackRock has launched a tool ranking the safety of a country’s bonds.

Going well beyond the usual measure of sovereign risk, the debt to GDP ratio, the firm’s new product weighs factors such the country’s demographics, per capita GDP, bond terms, the chance of inflation, and currency strength. 

For example, the United Kingdom’s bonds have longer terms than Greece’s, which gives the British more time to recover.

Norway tops the list, with low debt and few risks from abroad.

Not surprisingly, Greece and Portugal are at the bottom, but for different reasons.

"Greece’s debt sustainability problems are a result of the fiscal dynamics of the government, whereas Ireland’s problems are primarily related to the size and quality of its banking sector. Therein lies one of the most valuable features of this index: the ability to explore in detail the drivers of a specific country’s rankings," writes co-authors Benjamin Brodsky, Garth Flannery, and Sami Mesrour of BlackRock’s Fixed Income Asset Allocation team.

Belgium ranked further down than its AA + rating would predict. Among its reasons for weakness is the fact that only 41% of the countries’ bonds are owned by Belgians and many of its bonds are coming to term in the next two years.

Italy also looks riskier than its current market assessment, according to BlackRock’s approach. Although it expects a budget surplus, it has an aging population and runs regular deficits.

The United States ranks 15th, just below China, and well behind Canada and Germany.

The authors said the factors they chose are far from uncontroversial and that “tough questions” about weighing data were “generally addressed using our intuition.”

Although they didn’t include bond prices in their considerations, their results line up well with the market, “which suggests that we have identified significant drivers of sovereign risk.”