The Economics of Exchanges

Josanco Floreani and Maurizio Polato
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Josanco Floreani: University of Udine
Maurizio Polato: University of Udine

Chapter 5 in The Economics of the Global Stock Exchange Industry, 2014, pp 128-163 from Palgrave Macmillan

Abstract: Abstract The consolidation process which has occurred during the last few years has changed the morphology of the exchange industry in a substantial way, and also effected a widespread transformation of the business model of major exchanges. We noted in Chapter 2 that business diversification is a strategic choice in an industry landscape where exchanges’ revenues are under pressure. To this end, exchanges have attempted to counteract the adverse effects of both competition and economic downturns on trading revenues. The most striking example of this is the combination of cash market and derivatives market activities — something which constitutes the case for almost all of the exchanges involved in mergers, given the countercyclical nature of derivatives trading.

Keywords: Trading Volume; Platform Operator; Capital Endowment; Trading Service; Security Exchange (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:pal:pmschp:978-1-137-32183-1_5

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DOI: 10.1057/9781137321831_5

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