We investigate the trading and yield effects of covenant-lite (cov-lite) high-yield bond contracts, which have a restricted (lite) set of covenants. The excluded covenants often are those that use accounting performance measures. Although much research has focused on the potential benefits of accounting as a basis for debt contracting, little is known about settings where it may be optimal to exclude accounting performance statistics from public debt contracts. We find that cov-lite high-yield bonds have a higher trading turnover and lower yield spreads. Our findings provide empirical support for theory, which predicts, for optimal bond covenant design, that a trade-off between improving trading ease versus enhanced investor protection needs to be managed. These results enhance our understanding of the limits of accounting’s role in (bond) contracting design.

我们研究了具有有限（精简版）契约集的轻盟（cov-lite）高收益债券合约的交易和收益效应。排除的契约通常是那些使用会计绩效指标的契约。尽管许多研究都集中在会计作为债务合同基础的潜在好处上，但对于从公共债务合同中排除会计绩效统计数据的最佳设置，人们知之甚少。我们发现Cov-lite高收益债券的交易额更高，收益率差也更低。我们的发现为理论提供了经验支持，该理论预测，对于最佳债券契约设计，需要在提高交易便利性与增强投资者保护之间进行权衡。