Should Corporate Bond Trading Be Centralized
Download Should Corporate Bond Trading Be Centralized full books in PDF, epub, and Kindle. Read online free Should Corporate Bond Trading Be Centralized ebook anywhere anytime directly on your device. Fast Download speed and no annoying ads. We cannot guarantee that every ebooks is available!
Should Corporate Bond Trading be Centralized?
Author | : Sebastien Plante |
Publisher | : |
Total Pages | : 122 |
Release | : 2018 |
Genre | : |
ISBN | : |
Download Should Corporate Bond Trading be Centralized? Book in PDF, Epub and Kindle
This paper shows that centralizing the US corporate bond market would yield large gains in efficiency. By studying two markets where corporate bonds are successfully traded on central limit order books, I estimate that the transaction costs of US corporate bonds would decrease by 70% on average if trading migrated from over-the-counter markets to limit order markets. To study the social value of reforming the corporate bond market, I build a parsimonious model of centralized and decentralized trading. The model implies that the optimal market structure can be determined by appropriately scaling the transaction costs associated with each market structure. Estimating the scaling factors reveals that moving to limit order markets would generate a social surplus equal to 21 bps of total par value. Large bond issues with low credit ratings and long time to maturity would benefit the most.
Should Corporate Bond Trading be Centralized? Related Books
Pages: 122
Pages: 59
Pages:
Pages: 384
Pages: 452