Publications

SSRN

Working Paper

Measuring the Perceived Liquidity of the Corporate Bond Market

By: Sergey Chernenko and Adi Sunderam

We propose a novel measure of bond market liquidity that does not depend on transaction data: the strength of the cross-sectional relationship between mutual fund cash holdings and fund flow volatility. Our measure captures how liquid funds perceive their portfolio... View Details

Keywords: Bond Market; Bonds; Financial Liquidity; Measurement and Metrics

March 2016 (Revised May 2021)
Case

Michael Milken: The Junk Bond King

By: Tom Nicholas and Matthew G. Preble

Michael Milken, an investment banker who dominated the junk bond market in the 1980s, was sentenced to jail in 1990 after pleading guilty to a number of securities and tax-related felonies. In the preceding decade, Milken had helped usher in a new wave of leveraged buy... View Details

Keywords: Junk Bonds; High-yield Bonds; Financial Innovation; Shareholder Value; Bonds; Capital; Capital Structure; Cost of Capital; Crime and Corruption; Entrepreneurship; Ethics; Finance; Investment Banking; Leveraged Buyouts; Mergers and Acquisitions; Ownership; Private Equity; Restructuring; United States

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Fast Answer

Bloomberg: corporate bonds

How do I look up and analyze corporate bonds in Bloomberg? To locate corporate bonds: Use Custom Bond Search Type SRCH then hit [GO] Fill in the... View Details

Fast Answer

Corporate bond ratings

Where can I find ratings of corporate bonds? In Bloomberg: Hit the yellow CORP key (F3), then hit GO. Type TK then hit GO for Ticker Symbol Look Up. Type in issuer name; select correct issuing body; select specific security. Type in CRPR... View Details

June 2013
Article

Issuer Quality and Corporate Bond Returns

By: Robin Greenwood and Samuel G. Hanson

We show that the credit quality of corporate debt issuers deteriorates during credit booms, and that this deterioration forecasts low excess returns to corporate bondholders. The key insight is that changes in the pricing of credit risk disproportionately affect the... View Details

Keywords: Quality; Bonds; Forecasting and Prediction; Credit

2012
Working Paper

Issuer Quality and Corporate Bond Returns

By: Robin Greenwood and Samuel G. Hanson

We show that the credit quality of corporate debt issuers deteriorates during credit booms, and that this deterioration forecasts low excess returns to corporate bondholders. The key insight is that changes in the pricing of credit risk disproportionately affect the... View Details

Keywords: Price; Credit; Risk and Uncertainty; Investment Return; Forecasting and Prediction; Bonds; Market Design; Cost of Capital; Mathematical Methods; System Shocks

Fast Answer

Bloomberg: dead corporate bonds

How do I find dead corporate bonds in Bloomberg? In Bloomberg matured bonds are accessed through the Related Securities screen for a security .
To get to a Related... View Details

2020
Working Paper

Internal Models, Make Believe Prices, and Bond Market Cornering

By: Ishita Sen and Varun Sharma

Exploiting position-level heterogeneity in regulatory incentives to misreport and novel data on regulators, we document that U.S. life insurers inflate the values of corporate bonds using internal models. We estimate an additional $9-$18 billion decline in regulatory... View Details

Keywords: Life Insurers; Capital Regulation; Internal Models; Corporate Bonds; Regulatory Supervision; Concentrated Ownership; Bonds; Capital; Governing Rules, Regulations, and Reforms; Insurance; Investment Portfolio

SSRN

2021
Working Paper

The Green Bonding Hypothesis: How Do Green Bonds Enhance the Credibility of Environmental Commitments?

By: Shirley Lu

This paper proposes and provides evidence on a green bonding hypothesis, where green bonds act as a commitment device that subjects firms to institutions holding them accountable to their environmental promises. I find that green-bond issuers face higher climate change... View Details

Keywords: Bonding Hypothesis; Sustainable Finance; Climate Change; Corporate Social Responsibility and Impact; Environmental Sustainability; Bonds; Corporate Accountability

SSRN

24 Feb 2011
Working Paper Summaries

Issuer Quality and Corporate Bond Returns

Keywords: by Robin Greenwood & Samuel G. Hanson

February 2005
Article

Can Foreign Firms Bond Themselves Effectively by Renting U.S. Securities Laws?

By: Jordan I. Siegel

The study tests the functional convergence hypothesis, which states that foreign firms can leapfrog their countries' weak legal institutions by listing equities in New York and agreeing to follow U.S. securities law. Evidence shows that the SEC and minority... View Details

Keywords: Corporate Governance; Cross-listing; Reputation; Bonding; Business Ventures; Laws and Statutes; Financial Instruments; United States; Mexico

29 Jun 2020
Working Paper Summaries

Measuring the Perceived Liquidity of the Corporate Bond Market

Keywords: by Sergey Chernenko and Adi Sunderam; Financial Services

March 1980 (Revised October 1980)
Background Note

Note on the Corporate Bond Markets

2022
Article

The Pricing and Ownership of U.S. Green Bonds

By: Malcolm Baker, Daniel Bergstresser, George Serafeim and Jeffrey Wurgler

We study green bonds, which are bonds whose proceeds are used for environmentally sensitive purposes. After an overview of the U.S. corporate and municipal green bonds markets, we study pricing and ownership patterns using a simple framework that incorporates assets... View Details

Keywords: Green Bond; Pricing; Climate Finance; ESG; SRI; Sustainable; Municipal; Bonds; Environmental Sustainability; Financial Markets; Price; Ownership; United States

Research Summary

What Makes the Bonding Stick? A Natural Experiment Involving the U.S. Supreme Court and Cross-Listed Firms

On March 29, 2010, the U.S. Supreme Court signaled its intention to geographically limit the reach of the U.S.securities antifraud regime and thus differentially exclude U.S.-listed foreign firms from the ambit of formal U.S.antifraud enforcement. We exploit this... View Details

Keywords: Cross-listing; Corporate Governance; Civil Liability; Bonding

2018
Working Paper

Corporate Bond Liquidity: A Revealed Preference Approach

By: Sergey Chernenko and Adi Sunderam

January 2023
Case

The Ford Motor Company Green Bond

By: Vikram S Gandhi and James Barnett

In November 2021, Ford Motor Company offered a $2.5 billion green bond to finance investments in electrification. Issuance of green bonds significantly increased into the 2020s, and to date, the Ford Motor Company green bond was the largest such bond offered by a... View Details

Keywords: Finance; Bonds; Green Technology; Financial Services Industry; Auto Industry; United States

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2018
Working Paper

Corporate Refinancing, Covenants, and the Agency Cost of Debt

By: Daniel Green

How valuable are restrictive debt covenants in reducing the agency costs of debt? I exploit the revealed preference decision to refinance fixed-coupon bonds, which weighs observable interest rate savings against the unobservable costs of a change in restrictive... View Details

Keywords: Covenants; Refinancing; Corporate Bonds; Agency Costs; Debt Policy; Borrowing and Debt; Bonds; Interest Rates