Investors' Reaction to Corporate Events Announcements

This paper is devoted to the research of investors' reaction to the bond issue. Since the publication of the theory of irrelevance by the authors of Modigliani & Miller (1961), the capital structure is one of the most discussed topics in corporate finance. A lot of research on this topic was carried out in the developed capital markets, the results turned out to be contradictory. Some authors have identified a positive relationship between bond issue and share price, others identified negative, and some researchers have not found any dependency at all. For the Russian market this research is new. The paper is structured as follows. The first chapter provides an overview of the available research on this topic: theories and empirical observations of the impact of debt issuance and its determinants. In the second chapter, the choice of a method for investigating investor reaction to bond issues and a method for determining the determinants of investor reaction to bond issues are disclosed. The third chapter presents an interpretation of the results of the event and regression analyzes, conclusions about the market reaction to the bond issue, and factors that significantly influence the investors' reaction to the bond issue.