Abstract
The capital market has an important role in the economy of a country, as it serves as a source of funds for the company as well as a source of investment for the community. Bonds are financial instruments or securities that show that bond issuers have the obligation to pay the coupons and pay off the underlying debt at the appointed time. This research focuses on financial risk that is a financial ratio consisting of profitability and liquidity. This research aims to determine the impact of profitability and liquidity on bond rating and the impact on the bond yield on non-financial companies listed on the Indonesia Stock Exchange (IDX) period 2014-2018. The methods used are descriptive and verificative. The sampling technique used in this study was Purposive Sampling. The number of companies being sampled in this study was 33 companies. This study uses the path analysis method to determine which variables have an influence on bond ratings and their impact on bond yield. The results showed that the variable profitability had a significant effect on bond ratings, liquidity had no significant effect on bond ratings, and bond ratings were significantly influential on bond yield
Highlights
During the Central Statistics agency through the official website released the economic growth of Indonesia up 4.21 percent compared to the quarter I 2018 (Q Toq) and grew 5.27 percent compared to the same period last year (YoY)
Bond rating can be predicted by the factors that affect them that are used in the study is profitability and liquidity
If the company provides positive information it will be positively responded by the investor, the positive information is when the company's reported bond rating increases
Summary
During the Central Statistics agency through the official website released the economic growth of Indonesia up 4.21 percent compared to the quarter I 2018 (Q Toq) and grew 5.27 percent compared to the same period last year (YoY). Economic growth of this period has been the highest since 2014. In 2017 precisely the quarter I economic growth increased by 5.01 percent, quarter II was numbered at 5.01 percent, quarter III rises at 5.06 percent and continues to experience good in the fourth quarter with a recorded economic growth of 5.19 percent. The growth of capital markets in Indonesia continues to increase annually
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