scholarly journals Impact of Bond Market Development on the Growth of the Nigerian Economy

2021 ◽  
Vol 21 (1) ◽  
pp. 60-75
Author(s):  
Michael O. Oke ◽  
Oluwabunmi Dada ◽  
Nelson O. Aremo
Keyword(s):  
Financial Institution ◽  
Negative Relationship ◽  
Bond Market ◽  
Corporate Bond ◽  
Market Development ◽  
Bond Markets ◽  
Government Bond ◽  
Bond Yield ◽  
Traditional Function ◽  
The Impact

Abstract Research background: The traditional function ascribed to a modern financial institution is to mobilize resources among the two units (surplus and deficit) of the economy. This can be achieved when financial institutions wake up to this responsibility and act as the pillar upon which other institutions can rely on. Purpose: This study examined the impact of bond market development on the growth of the Nigerian economy from 1986–2018. Research methodology: Data were analysed using the co-integration bounds test approach while the robustness of the estimates was also checked. Results: Government bond exhibited an insignificant positive relationship; corporate bond and value of bond traded were positive and statistically significant (prob. <0.05) while bond yield indicated a negative relationship with the growth of the Nigerian economy. Novelty: The study found that corporate bond and the value of bond traded were the major variables that increased the depth of bond market development in Nigeria. Therefore, policymakers in Nigeria should encourage the issuance of more corporate bonds to further enhance the efficiency of bond markets development.

scholarly journals BOND MARKET EFFICIENCY AND VOLATILITY: EVIDENCE FROM RUSSIA

2019 ◽  
Vol 7 (4) ◽  
pp. 1389-1397
Author(s):  
Shadi Omran ◽  
Elena Semnkova
Keyword(s):  
Market Efficiency ◽  
Unit Root Test ◽  
Weak Form ◽  
Bond Market ◽  
Corporate Bond ◽  
Good Representation ◽  
Bond Markets ◽  
Government Bond ◽  
Time Model ◽  
Bond Index

Purpose of the study: In this paper, we use daily return for the Moscow Exchange Government Bond index (RGBITR) and Moscow Exchange Corporate Bond index (MICEXCBITR) over the period 2013 to 2018. Methodology: Normality test, unit root test (ADF) and Generalized Autoregressive Conditional Heteroscedasticity (GARCH) model will be used in this paper. Results: The empirical results reveal that both government and corporate bond markets in Russia are not weak-form efficient. Furthermore, the volatility is persistent in both bond indices and resembles the same movement in returns. We find also that the GARCH (1,1) model is a good representation of the behavior of daily bond index returns in corporate and government bond markets in Russia. Applications of this study: This research can be used for the universities, teachers, and students. Novelty/Originality of this study: In this paper, for the first-time model of bond market efficiency and volatility has been studied.

FOREIGN PARTICIPATION IN LOCAL CURRENCY BOND MARKETS OF EMERGING ECONOMIES

2013 ◽  
Vol 04 (03) ◽  
pp. 1350016 ◽  
Author(s):  
SHANAKA J. PEIRIS
Keyword(s):  
Data Analysis ◽  
Emerging Economies ◽  
Panel Data Analysis ◽  
Bond Market ◽  
Bond Markets ◽  
Government Bond ◽  
Bond Yields ◽  
Local Currency ◽  
The Impact

This paper estimates the impact of foreign participation in determining long-term local currency government bond yields and volatility in a group of emerging markets (EMs) from 2000 to 2009. The results of a panel data analysis of 10 EMs show that greater foreign participation in the domestic government bond market tends to significantly reduce long-term government yields. Moreover, greater foreign participation does not necessarily result in increased volatility in bond yields in EMs and, in fact, could even dampen volatility in some instances.

scholarly journals The Theory and Empirics of Financial Development in the East Asian Bond Markets

2014 ◽  
Vol 5 (1) ◽  
pp. 45-76
Author(s):  
Thomas Kemetmüller
Keyword(s):  
Financial Crisis ◽  
Financial Development ◽  
Global Financial Crisis ◽  
East Asian ◽  
Bond Market ◽  
Corporate Bond ◽  
Bond Markets ◽  
Government Bond ◽  
Corporate Bond Market ◽  
The Government

Abstract The Asian financial crisis marked a turning point in financial development in East Asia that brought the development of bond markets within the focus of policy-makers. This paper tracks the benefits of an advanced bond market, the current state of the East Asian corporate and government bond markets and their rapid evolution since the Asian crisis. Subsequently, a multivariate model is used to determine the endogenous economic and institutional factors that drove growth in the region’s bond markets. The following findings may be noted: (1) growth in the government bond market was driven by the monetary sterilisation efforts of East Asian central banks in order to cope with excessive liquidity, (2) the government bond market may crowd out the corporate bond market, and (3) the corporate bond market grew particularly strongly during the global financial crisis.

Modeling the green bond yield on bond offering

2020 ◽  
Vol 26 (12) ◽  
pp. 2858-2878
Author(s):  
M.I. Emets
Keyword(s):  
Linear Regression ◽  
Yield Curve ◽  
Bond Market ◽  
Third Party ◽  
Bond Pricing ◽  
Market Development ◽  
Fair Price ◽  
Lower Yield ◽  
Yield Curves ◽  
Bond Yield

Subject. The article addresses the green bond pricing as compared to bonds other than green ones. Objectives. The aims are to determine how the fact that a bond is identified as a green one, the issue amount, and the availability of third-party verification, influence the yield to maturity; to make recommendations on effective green bond pricing. Methods. The study employs econometric testing of hypotheses, using the multiple linear regression. The sample includes 318 green and 1695 conventional bonds. Results. Green bonds have a lower yield to maturity in comparison with conventional bonds. The yield to maturity of green bonds with third-party verification is lower, as contrasted with green bonds without verification. Conclusions. The next step in the green bond market development is creating a benchmark yield curve for sovereign green bonds, with parallel issuance of conventional, non-green bonds. The yield curve is crucial for effective bond pricing. Two yield curves, i.e. for green and non-green bonds, will enable investors to estimate the fair price on issuance, as well as to define, if there is a difference in pricing.

Corporate Bond Markets

2019 ◽  
pp. 113-130
Author(s):  
Kelly E. Carter
Keyword(s):  
Interest Rates ◽  
Credit Ratings ◽  
Corporate Bonds ◽  
Corporate Bond ◽  
Bond Markets ◽  
Bond Prices ◽  
Wall Street ◽  
Yield Curves ◽  
Bond Portfolios ◽  
The Impact

This chapter covers the fundamentals of corporate bond markets. It begins by highlighting the size and importance of these markets, followed by a discussion of the major types of corporate bonds and the process of issuing bonds. Next, the chapter provides a discussion of important relationships between a bond’s price and market interest rates, including the key observation that bond prices move opposite market interest rates. The next topic focuses on duration and convexity, which are techniques to estimate the dollar and percent changes in bond prices for a given change in market interest rates, followed by a discussion of bond immunization, which is a technique used to protect the value of bond portfolios from adverse changes in market interest rates. The final topics covered concern yield curves, credit ratings, and the impact of the Dodd-Frank Wall Street Reform Act of 2010 on corporate bond markets.

How Firm and Market Characteristics Affect Profitability

2015 ◽  
Vol 2 (1) ◽  
pp. 67-83 ◽  
Author(s):  
Ioannis Katsampoxakis ◽  
Haralampos Basdekis ◽  
Konstantinos Anathreptakis
Keyword(s):  
Sovereign Debt ◽  
Debt Crisis ◽  
Government Bond ◽  
Sovereign Debt Crisis ◽  
Bond Yield ◽  
Time Period ◽  
Greek Government ◽  
Greek Economy ◽  
Greek Government Bond ◽  
The Impact

This study aims to assess the impact of specific corporate and market features on the profitability of firms. More precisely, the variables examined for the purposes of this study are firms' size, financial leverage, accruals, volatility of profitability, growth rate of the Greek economy, the 10-year Greek government bond yield, and the Greek sovereign debt crisis. The empirical results exhibit an average profitability of 10.71%, which varies significantly both between firms and during the time period examined. Another finding of this study is the verification of the theoretical relationship between the above variables and Greek firms' profitability between 2004 and 2012. Whereas variables such as firms' size, volatility of profitability and accruals do not seem to affect firms' profitability in a statistically significant way, the signs of the coefficients are consistent with those found the literature review.

Residual Equity Momentum Spillover in Global Corporate Bond Markets

2019 ◽  
Keyword(s):  
Return Predictability ◽  
Bond Market ◽  
Corporate Bond ◽  
Bond Markets ◽  
Corporate Bond Market ◽  
Pricing Factors ◽  
Bond Return ◽  
Abnormal Pattern ◽  
Additional Support ◽  
Investment Grade

This article presents an improved equity momentum measure for corporate bonds, using the euro-denominated global investment-grade corporate bond market from 2000 to 2016. The author documents economically meaningful and statistically significant corporate bond return predictability. In contrast to the widely used total equity return, momentum as measured by the residual (idiosyncratic) equity return appears to further enhance risk-adjusted performance of corporate bond investors. Additional support for this conjecture is obtained from tests for various asset pricing factors and transaction costs, as exposure to these risk factors cannot explain this abnormal pattern in returns.

Toward Developing Regional Bond Markets in East Asia

2004 ◽  
Vol 3 (2) ◽  
pp. 183-209 ◽  
Author(s):  
Daekeun Park ◽  
Yung Chul Park
Keyword(s):  
East Asia ◽  
Bond Market ◽  
Market Development ◽  
Bond Markets ◽  
Asian Countries ◽  
Financial Cooperation ◽  
Road Map ◽  
Currency Mismatch ◽  
Financial Infrastructure

Creating regional bond markets in East Asia has emerged as an important policy topic in discussions of how to promote regional monetary and financial cooperation to prevent future crises in the region. We evaluate the rationale and the strategies and propose a road map for developing regional bond markets in East Asia. We propose a market-oriented approach to development of the regional bond markets with the role of the official sector limited to such activities as building the regional financial infrastructure. We also suggest that the eventual goal of regional bond market development should be the development of domestic bond markets in the region. If domestic bond markets are fortified by domestic financial infrastructure and are deregulated and opened to foreign borrowers and investors, many of the Asian countries will be able to mitigate maturity and currency mismatch problems.

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