{"status":"ok","message-type":"work","message-version":"1.0.0","message":{"indexed":{"date-parts":[[2026,10,22]],"date-time":"2026-10-22T14:37:37Z","timestamp":1792679857428,"version":"4.5.0"},"posted":{"date-parts":[[2026]]},"group-title":"SSRN","reference-count":0,"publisher":"Elsevier BV","license":[{"start":{"date-parts":[[2026,1,1]],"date-time":"2026-01-01T00:00:00Z","timestamp":1767225600000},"content-version":"unspecified","delay-in-days":0,"URL":"https:\/\/www.uspto.gov\/ip-policy\/copyright-policy\/copyright-basics"}],"content-domain":{"domain":[],"crossmark-restriction":false},"short-container-title":[],"abstract":"<jats:p>We study trading costs in the corporate bond market using intraday reference bid and ask quotes that are available even when a bond does not trade. Transaction-based measures disproportionately exclude high-cost bond-days and compare prices observed at different times, thereby distorting both trade costs estimates and estimates of relations between trading costs and bond characteristics such as issue size. We document that the reference quote data we employ are of high quality in that prices for customer buys (sells) are centered on the reference ask (bid) price. Reference bid-ask spreads are well correlated with effective spreads estimated from TRACE prices alone, with the divergence growing larger with greater elapsed time between trade and benchmark prices. Combining reference prices with request-for-quote data allows us to observe occasions of one-sided investor trading interest when trades do not result. Liquidity is poor at such times, and reference quote bid-ask spreads widen for days, but the deterioration in liquidity would not be detected by trade-based measures.<\/jats:p>","DOI":"10.2139\/ssrn.7652218","type":"posted-content","created":{"date-parts":[[2026,10,22]],"date-time":"2026-10-22T13:37:38Z","timestamp":1792676258000},"source":"Crossref","is-referenced-by-count":0,"title":["Trading Costs When Bonds Do Not Trade: Evidence from Reference Prices"],"prefix":"10.2139","author":[{"given":"Hendrik (Hank)","family":"Bessembinder","sequence":"first","affiliation":[],"role":[{"vocabulary":"crossref","role":"author"}]},{"given":"Stacey E.","family":"Jacobsen","sequence":"additional","affiliation":[],"role":[{"vocabulary":"crossref","role":"author"}]},{"given":"Kumar","family":"Venkataraman","sequence":"additional","affiliation":[],"role":[{"vocabulary":"crossref","role":"author"}]},{"given":"David","family":"Xu","sequence":"additional","affiliation":[],"role":[{"vocabulary":"crossref","role":"author"}]}],"member":"78","container-title":[],"original-title":[],"deposited":{"date-parts":[[2026,10,22]],"date-time":"2026-10-22T13:37:38Z","timestamp":1792676258000},"score":1,"resource":{"primary":{"URL":"https:\/\/www.ssrn.com\/abstract=7652218"}},"subtitle":[],"short-title":[],"issued":{"date-parts":[[2026]]},"references-count":0,"URL":"https:\/\/doi.org\/10.2139\/ssrn.7652218","relation":{},"subject":[],"published":{"date-parts":[[2026]]},"subtype":"preprint"}}