Ride on Past? Evidence from Corporate Bond Offering Price Persistence

Research output: Chapters, Conference Papers, Creative and Literary Works (RGC: 12, 32, 41, 45)12_Chapter in an edited book (Author)peer-review

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Author(s)

  • Haoyu Gao
  • Ruixiang Jiang
  • Chunchi Wu
  • Xiaoguang Yang

Related Research Unit(s)

Detail(s)

Original languageEnglish
Title of host publicationADVANCES IN PACIFIC BASIN BUSINESS, ECONOMICS AND FINANCE
EditorsCHENG-FEW LEE, MIN-TEH YU
PublisherEmerald Publishing Limited
Pages107-135
ISBN (Electronic)978-1-80043-870-5 , 978-1-80043-872-9
ISBN (Print)978-1-80043-871-2
Publication statusPublished - 2021

Publication series

NameAdvances in Pacific Basin Business, Economics and Finance
PublisherEmerald Publishing Limited
Volume9
ISSN (Print)2514-4650

Abstract

This chapter presents evidence of persistence in pricing new corporate bond issues. Both transition matrix and regression analyses show that cross-sectional differences in the yields of initial public bond offerings across issuers persist over time, and the persistence effect is stronger for firms with no rating changes, less frequent bond issuance, and higher information asymmetry. Our findings support the hypothesis of the “ride on past” behavior and confirm the value of information production accumulated from the past bond issuances for the pricing of newly issued bonds.

Research Area(s)

  • Transition matrix, persistence, bond offering, information production, yield spread, information asymmetry

Bibliographic Note

Research Unit(s) information for this publication is provided by the author(s) concerned.

Citation Format(s)

Ride on Past? Evidence from Corporate Bond Offering Price Persistence. / Gao, Haoyu; Jiang, Ruixiang; Wu, Chunchi; Yang, Xiaoguang.

ADVANCES IN PACIFIC BASIN BUSINESS, ECONOMICS AND FINANCE. ed. / CHENG-FEW LEE; MIN-TEH YU. Emerald Publishing Limited, 2021. p. 107-135 (Advances in Pacific Basin Business, Economics and Finance; Vol. 9).

Research output: Chapters, Conference Papers, Creative and Literary Works (RGC: 12, 32, 41, 45)12_Chapter in an edited book (Author)peer-review