Where are most corporate bonds traded in the secondary market in the Philippines?

Most corporate bonds in the Philippines are traded in the secondary market over the counter (OTC). The OTC market allows for more flexibility and direct interaction between buyers and sellers, often involving dealers who facilitate transactions without going through a centralized exchange like a stock exchange. This environment is particularly advantageous for trading corporate bonds, as it accommodates the negotiation of prices and terms directly between parties.

The OTC market also tends to have a broader range of participants, including institutional investors and banks, who engage in larger volume trades that may not be suitable for public exchanges. This setting encourages more efficient price discovery and is essential for the bond market, where transactions may require greater confidentiality and a tailored approach, given the varying sizes and characteristics of bonds.

In contrast, the other options such as the Stock Exchange or a specialized Bond Market Exchange generally focus on equities or listed bonds from larger issuers. Private auctions may occur but are not the primary venue for typical corporate bond trading, which emphasizes the importance of the OTC market for these financial instruments.