Trade disclosure regulation in markets with negotiated trades
Publication
, Journal Article
Naik, NY; Neuberger, A; Viswanathan, S
Published in: Review of Financial Studies
January 1, 1999
In dealership markets disclosure of size and price details of public trades is typically incomplete. We examine whether full and prompt disclosure of public-trade details improves the welfare of a risk-averse investor. We analyze a model of dealership market where a market maker first executes a public trade and then offsets her position by trading with other market makers. We distinguish between quantity risk and price revision risk. We show that if the market maker learns some information about the motive behind public trade, neither regime is unambiguously welfare superior. This is because greater transparency improves quantity risk sharing but worsens price revision risk sharing.
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Published In
Review of Financial Studies
DOI
ISSN
0893-9454
Publication Date
January 1, 1999
Volume
12
Issue
4
Start / End Page
873 / 900
Related Subject Headings
- Finance
- 3801 Applied economics
- 3502 Banking, finance and investment
- 1502 Banking, Finance and Investment
- 1402 Applied Economics
- 1401 Economic Theory
Citation
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Naik, N. Y., Neuberger, A., & Viswanathan, S. (1999). Trade disclosure regulation in markets with negotiated trades. Review of Financial Studies, 12(4), 873–900. https://doi.org/10.1093/rfs/12.4.873
Naik, N. Y., A. Neuberger, and S. Viswanathan. “Trade disclosure regulation in markets with negotiated trades.” Review of Financial Studies 12, no. 4 (January 1, 1999): 873–900. https://doi.org/10.1093/rfs/12.4.873.
Naik NY, Neuberger A, Viswanathan S. Trade disclosure regulation in markets with negotiated trades. Review of Financial Studies. 1999 Jan 1;12(4):873–900.
Naik, N. Y., et al. “Trade disclosure regulation in markets with negotiated trades.” Review of Financial Studies, vol. 12, no. 4, Jan. 1999, pp. 873–900. Scopus, doi:10.1093/rfs/12.4.873.
Naik NY, Neuberger A, Viswanathan S. Trade disclosure regulation in markets with negotiated trades. Review of Financial Studies. 1999 Jan 1;12(4):873–900.
Published In
Review of Financial Studies
DOI
ISSN
0893-9454
Publication Date
January 1, 1999
Volume
12
Issue
4
Start / End Page
873 / 900
Related Subject Headings
- Finance
- 3801 Applied economics
- 3502 Banking, finance and investment
- 1502 Banking, Finance and Investment
- 1402 Applied Economics
- 1401 Economic Theory