The Role of Trading Halts in Monitoring a Specialist Market
Publication
, Journal Article
Edelen, R; Gervais, S
Published in: Review of Financial Studies
2003
When a collection of specialists organize as an exchange, each can reap net private benefits at the expense of the exchange by quoting a privately optimal pricing schedule. Coordination makes all specialists and customers better off, but requires a system of monitoring and punishment that breaks down when information asymmetries between the exchange and a specialist are high. The specialist may then seek a temporary trading halt to alleviate unjustified punishment, or the exchange may halt trading to prevent the quoting of damaging privately optimal pricing schedules. We test this theory on a sample of NYSE halts. As predicted, we find a significant increase in estimated information asymmetry immediately preceding trading halts.
Duke Scholars
Published In
Review of Financial Studies
ISSN
0893-9454
Publication Date
2003
Volume
16
Issue
1
Start / End Page
263 / 300
Related Subject Headings
- Finance
- 1502 Banking, Finance and Investment
- 1402 Applied Economics
- 1401 Economic Theory
Citation
APA
Chicago
ICMJE
MLA
NLM
Edelen, R., & Gervais, S. (2003). The Role of Trading Halts in Monitoring a Specialist Market. Review of Financial Studies, 16(1), 263–300.
Edelen, R., and S. Gervais. “The Role of Trading Halts in Monitoring a Specialist Market.” Review of Financial Studies 16, no. 1 (2003): 263–300.
Edelen R, Gervais S. The Role of Trading Halts in Monitoring a Specialist Market. Review of Financial Studies. 2003;16(1):263–300.
Edelen, R., and S. Gervais. “The Role of Trading Halts in Monitoring a Specialist Market.” Review of Financial Studies, vol. 16, no. 1, 2003, pp. 263–300.
Edelen R, Gervais S. The Role of Trading Halts in Monitoring a Specialist Market. Review of Financial Studies. 2003;16(1):263–300.
Published In
Review of Financial Studies
ISSN
0893-9454
Publication Date
2003
Volume
16
Issue
1
Start / End Page
263 / 300
Related Subject Headings
- Finance
- 1502 Banking, Finance and Investment
- 1402 Applied Economics
- 1401 Economic Theory