Finance

What is market fragmentation? It refers to fragmented market where investors send blesss to numerous profession venues that all compete with each separate for set out flow. A handicraft venue can be a physical place worry the floor of the New York lineage Ex swop or a virtual syllabus comparable electronic market for occupation stocks of Nasdaq. According to the article, proliferation of employment venues is at present one of the most significant changes in pecuniary market. bandage the conventional exchanges still account for the major assign of drifts, they ar currently facing the challenge from other trading venues. For example, the traditional equity markets in US standardized big board and Nasdaq straightway have a host of competitors include electronic platform such as Electronic Communication net income (ECNs) and resource Trading System (ATs), trading desks of broker-dealer firms and even a assortment of new entrants such as futures and options ma rkets. Besides, these changes are non gracious happening in America. European equity markets are experiencing conspicuous growth of new trading venues, which are the electronic platforms like Chi-X and BATS. In Canada, the fragmentation is in any case taking place with access of electronic venues like Alpha, Pure and MATCH Now.

As a result, such increase in fragmentation of financial markets is the musical theme of the authors to conduct this research. However, it is not quite clear that how fragmentation of trading is affecting the market quality. Certainly, the addition of new trading venues has chang e magnitude competition, therefore forcing t! raditional exchanges to lower trading charges and other fees. Also, the proliferation of venues has provided a wider range of trading options to investors, therefore to foster innovations such as reductions in latency and more sophisticated crosswalk networks. hardly a opposite concern states that fragmentation of trading could be harming the quality of markets by reducing the liquidity lendable not only in the individual markets but also in the...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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