ABSTRAK The purpose of research is to analyze an impact of managerial stock ownership structure on corporate bond returns. This study suggesteThe purpose of research is to analyze an impact of managerial stock ownershipstructure on corporate bond returns. It is assumed that the change in managerialstock ownerships can influence managers' attitudes toward risk. So it is hypothesizedthat the change in managerial stock ownerships can influence corporate bond returns.This study suggested that there is a significant impact of managerial ownershipstructure on corporate bond returns. In 1998-1999 time series cross-section of31corporatf. bonds that were listed on Surabaya Stock Exchange, I've found evidence;of a significant non-monotonic relationship between managerial stock ownershipand corporate bond returns. Bond returns first increase, then decrease, and finallyrise slightly as ownership by manager rises.There is also weak evidence of a non-monotonic relationship between managerialstock ownership and firm leverage. This study finds a positive relation betweenmanagerial stock ownership and leverage up to 19.9 percent ownership level. Whenownership increases more (over 19.9 percent), however, the relationship becomesnegative. This empirical evidence indicates that greater managerial ownership givesmanagers an incentive to decrease risk by using low level of debt.d that there is a significant impact of managerial ownership structure on corporate bond returns. |