Unlocking Liquidity: The Role of Market Makers in Kuwait’s Emerging Market

Khaled Alsabah and Saud Asaad Althaqeb

Journal of Emerging Market Finance, 2025, vol. 24, issue 2, 145-169

Abstract: This study uses a difference-in-differences approach to examine the influence of market-maker agreements on liquidity alterations in Boursa Kuwait. Our research indicates that signing a market-maker agreement augments the number of executed trades, turnover, and trading volume while decreasing instances of zero trades, bid–ask spread, and Amihud Illiquidity within the first week. Interestingly, these agreements do not affect stock return volatility.  Our study extends the knowledge about the role of market makers in emerging markets. JEL Codes: G10, G18, O53

Keywords: Kuwait; bid–ask spread; liquidity; market maker (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:sae:emffin:v:24:y:2025:i:2:p:145-169

DOI: 10.1177/09726527241297241

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