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Information and liquidity of over-the-counter securities: Evidence from public registration of Rule 144A bonds

Song Han, Alan Guoming Huang, Madhu Kalimipalli and Ke Wang

Journal of Financial Markets, 2022, vol. 59, issue PB

Abstract: We examine the market liquidity effects of enhanced information induced by the public registration of 144 A bonds, a significant and growing segment of the U.S. bond market. Using the regulatory version of TRACE data for the 2002–2013 period, we find that liquidity measures improve consistently for higher ex-ante information asymmetry issues following public registration of 144 A bonds. Our results support that disclosure improves liquidity in the OTC bond market.

Keywords: Rule 144A bond; QIBs; Broker-dealers; Public registration; Liquidity; Information disclosure (search for similar items in EconPapers)
JEL-codes: G12 G14 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1016/j.finmar.2021.100655

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