Research On Liquidity Of China's Bond Market

China's bond market is an important part of economic. It plays an irreplaceable function. Liquidity problem is the important sings of China's bond market about efficiency and perfect or not. It is also an important indicator to measure the development of China's bond market. China's bond market which has developed very quickly in these years, but it still faces many problems. One major problem is that the markets are lack of liquidity which can't perform efficiently.First, this paper analyses width,depth,immediacy and resiliency which should be measured by liquidity. The paper introduces the methods which measure the liquidity of the market. It lay the theory foundation for China's bond market liquidity research. Recalling China's bond market development of liquidity ,the paper analyses the now state of inter-bank bond market, stock exchange of bond market and counter bond market from trading volume, trading and market participants. We not only affirm improvement of China's bond market liquidity, but also lay a realistic foundation for empirical research. Then we make a conclusion that China's bond market liquidity is not instable , according to data of Martin index for trend analysis. We can make a conclusion that these changes are not obvious, according to data of the stock exchange and inter-bank bond market Martin index for week and monthly changes in analysis and an analysis of variance factors. Turnover rate and bid-ask spread are common methods which measure depth and width of China's bond market. Through the contrast of China's bond market and western countries as well as some Asian countries, we can see that China's bond market is lack of liquidity . Second, the paper analyses many factors which affect China's bond market liquidity, for example, trading system is far from perfect, market system is not good, lack of the product itself, market participants agencies is unreasonable. These factors are all not good at development of China's bond market. Finally, this thesis puts forward special approvels to promte the liquidity of China's bond market, including unifying cleanling system, developing inter-bank bond market, increase bond varieties , founding government bond funds etc.