Orderbook demand for corporate bonds

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Abstract: We examine the determinants of investor demand for corporate bond offerings using novel data on the primary market orderbook size. We find that credit risk and bond market presence are significant in explaining investor demand. These effects are more pronounced during the crisis periods including the global financial crisis and eurozone crisis as well as during the postcrisis periods. Our results also highlight the size of the bond investor order depends on information asymmetry costs and the benefit of diversifications, as investor demand is lower for new issuers as well as very frequent issuers. The levels of investor demand have important economic consequences for bond issuers as high investor demand shortens the time to subsequent bond issues and potentially reduces the firm's cost of capital at issuance.
Original languageEnglish
Pages (from-to)247-287
Number of pages41
JournalEuropean Financial Management
Issue number1
Early online date9 Jul 2022
Publication statusE-pub ahead of print - 9 Jul 2022


  • investor demand
  • oversubscription
  • orderbook size
  • bond pricing


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