An Introduction to the Microstructure of Emerging Markets, Volume 63
IFC Discusssion Paper No. 24. Investors' interest in emerging markets has grown significantly in recent years because of potential high returns and the benefits of diversification. Despite this increased activity, there remains little information o
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ASSET auction type automated systems baht behavior best outstanding bid/ask spread billions BOVESPA brokerage houses brokers buyer and seller continuous auction contracts day's Developing Countries Dividend Yield Dollars millions economic Electronica emerging markets exchange computer exchange employee filled financial markets floor traders foreign important information systems investors Istanbul Stock Exchange Jakarta Stock Exchange limit orders Listed Companies Market Capitalization market information market liquidity market maker market microstructure market orders market participants market success normal trading Number of Listed number of shares Once entered open outcry order board order book order entry order matches order-book systems outstanding orders P.O. Box P/BV Ratio P/E Ratio percent periodic auctions pre-opening previous closing price provides quantity reference price reported Rupiah Sao Paulo sell orders settlement shares are traded Stock Exchange Suspension of Trade trading floor trading hours trading session Trading Value video screens volatility volume Walrasian auction
Page 5 - By adopting a microstructure that allows for competition among traders, or by assigning an individual market maker whose duty it is to ensure that trading is possible, microstructure can have a direct effect on trading costs and liquidity.
Page 5 - For that reason, markets that are more efficient will attract investors, which translates into increased market liquidity. Microstructure has an important role to play in encouraging market efficiency, both through the information services that are provided to participants, as well as through the nature of the trading system itself.
Page 5 - The availability of information reduces uncertainty and increases market interest, which leads back to liquidity. An important innovation in microstructure, automated trading systems, has taken place in recent years and reflects, to some extent, the importance of information and the trading system on market efficiency.
Page iii - Though closely related, each of these attributes is different and can be influenced by microstructure, the regulatory regime under which the market operates, as well as by the economic fundamentals which drive security prices.
Page ii - Financial markets play an important role in capitalist economies by facilitating intermediation between savers and investors. The better they perform that service, the more likely it is that savers will be motivated to supply capital, thereby reducing its...
Page 19 - Of the equity instruments, each company can issue as many as three different series of shares, each with different rights or shareholder bases. All series have full participation in the earnings of the firm, but each differs in its voting rights and shareholder base.
Page 4 - Even when open, some markets allow trades to occur only during periodic auctions, rather than continuously throughout the day. By limiting the number of trading hours and the manner in which traders meet, either continuously or at infrequent auctions, market microstructure has a direct impact on the liquidity of the market.
Page iii - Increasingly, microstructure theory highlights the importance of stock market institutional features and trading mechanisms as important determinants of market behavior.
Page 16 - These houses are allowed to trade both for their own account and for customers, some for all contracts (65), others for only financial contracts (82) and agricultural contracts (36).