Stock Market Liquidity in Chile
Stock Market Liquidity in Chile

Author: Mr.Luis Brandao-Marques

Publisher: International Monetary Fund

Published: 2016-11-16

Total Pages: 29

ISBN-13: 1475554656

DOWNLOAD EBOOK

Chile has a large but relatively illiquid stock market. Global factors such as global risk appetite and monetary policy in advanced economies are key cyclical determinants of liquidity in Chilean equities. Evidence from a cross-section of emerging markets suggests strong protection of minority shareholders can help improve stock market liquitidity. Currently, illiquid in Chilean may have to pay 31⁄2 percent more as cost of equity. Corporate governance should be improved, namely through the adoption of a stewardship code.

Effect of Ownership, Governance, and Transparency on Liquidity - Chilean Evidence
Effect of Ownership, Governance, and Transparency on Liquidity - Chilean Evidence

Author: Sakthi Mahenthrian

Publisher:

Published: 2013

Total Pages:

ISBN-13:

DOWNLOAD EBOOK

Companies with relatively thin trading, a high concentration of insider ownership, and a privatized pension system characterize Chile's Santiago Stock Exchange. Within this setting, we study the relationship between ownership concentration, corporate governance, and stock market liquidity. Our results suggest that board independence, corporate disclosure and outside monitoring by institutions help moderate the effects that insiders have on trading costs and liquidity. We also find that market makers with inventory reduce the informational component of trading costs. Finally, the trades of insiders provide price guidance to market makers, while traders employ a follow-the-insider strategy when transparency is low.

Stock Market Liquidity in Chile
Stock Market Liquidity in Chile

Author: Mr.Luis Brandao-Marques

Publisher: International Monetary Fund

Published: 2016-11-16

Total Pages: 29

ISBN-13: 1475554699

DOWNLOAD EBOOK

Chile has a large but relatively illiquid stock market. Global factors such as global risk appetite and monetary policy in advanced economies are key cyclical determinants of liquidity in Chilean equities. Evidence from a cross-section of emerging markets suggests strong protection of minority shareholders can help improve stock market liquitidity. Currently, illiquid in Chilean may have to pay 31⁄2 percent more as cost of equity. Corporate governance should be improved, namely through the adoption of a stewardship code.

Chile
Chile

Author: International Monetary

Publisher: International Monetary Fund

Published: 2022-09-12

Total Pages: 33

ISBN-13:

DOWNLOAD EBOOK

Chile is characterized by a highly interconnected financial system, which presents risks and opportunities for the development of liquidity markets. On the one hand, the large domestic non-bank financial sector (pension funds, mutual funds, insurers) creates a large investor base for domestic debt securities, fostering the development of these markets. On the other hand, the non-bank financial sector is vulnerable to shocks which may have significant spillovers to funding markets and to the banking system.

Chile: Financial System Stability Assessment
Chile: Financial System Stability Assessment

Author: International Monetary

Publisher: International Monetary Fund

Published: 2021-12-09

Total Pages: 111

ISBN-13: 1616356952

DOWNLOAD EBOOK

The financial system in Chile functions well overall within a sound regulatory framework. It features large and deep financial markets in a sector dominated by conglomerates, six systemic banks, and pension funds. The twin shocks of social unrest in late 2019 and COVID-19 were adeptly managed thanks to massive and well-coordinated supervisory and fiscal policy responses, as well as unprecedented liquidity support from the Central Bank of Chile (BCCh). Banks have remained profitable through the crisis, partially supported by central bank financing and government-guaranteed SME lending. The funded pension system that has been instrumental in market deepening is under threat due in part to a series of withdrawals. Congress has also authorized life annuity liquidations. A major reorganization of the financial regulatory authorities has been finalized, and Basel III will be implemented starting in December 2021.

Evidence of a Leadership Role in the Chilean Stock Exchanges
Evidence of a Leadership Role in the Chilean Stock Exchanges

Author: Franco Parisi

Publisher:

Published: 2001

Total Pages: 26

ISBN-13:

DOWNLOAD EBOOK

In our study of the two leading stock exchanges in Chile - the Santiago Stock Exchange (SSE) and the Electronic Stock Exchange (ESE) - we find that the SSE exhibits a leadership role over the ESE in terms of transmission of returns and volatility. These results indicate that prior empirical studies showing that the New York Stock Exchange leads other exchanges is a result of market structure factors rather than a quot;US effectquot;. The factors that lead to a leadership role are deeper liquidity, more effective monitoring, and a greater concentration of speculators. Markets possessing these factors will be the first to attract investors and will lead other exchanges. Although the leadership role of the SSE creates a predictable flow of information between markets, the ability to create arbitrage opportunities is mitigated by transaction costs and the current order processing mechanism in Chile. However, our results suggest that a market's leadership could result in arbitrage opportunities in countries with lower transaction costs or different order-processing mechanisms.