ABSTRACT
The purpose of this study is to determine the factors influencing bond liquidity in Indonesia’s secondary market. Multiple regression models are used to answer the research objectives. The results of the study show that the liquidity of corporate bonds in the Indonesian secondary market was positively influenced by market capitalization, inflation, and asymmetric information. In contrast, it is negatively affected by market indices, in this case, the Indonesia Composite Index and interest rates. Determination coefficient test results amounted to 34.1%, indicating that the independent variables only explained this level of bond liquidity. Also, the secondary market is not liquid since there are more OTC transactions, and investors are generally institutional stakeholders saving to the maturity date.
