Structure of Securities Markets

Robert A. Schwartz () and Lin Peng ()
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Robert A. Schwartz: Baruch College of the City University of New York
Lin Peng: Zicklin School of Business, Baruch College, CUNY

Chapter 39 in Encyclopedia of Finance, 2022, pp 1011-1016 from Springer

Abstract: Abstract The chapter reviews essential elements of market structure – the systems, procedures, and protocols that determine how orders are handled, translated into trades, and transaction prices determined. Various alternatives are contrasted such as: order-driven and quote-driven markets; consolidated vs. fragmented markets; human intervention vs. electronic trading; and continuous markets vs. periodic call auctions. A major objective of market design that is noted in the discussion is to enhance the accuracy with which prices are discovered in a dynamic, uncertain environment. Lastly, the chapter points out that market structures are rapidly changing, and that much remains to be learned about how best to structure a technologically sophisticated, hybrid market that efficiently services the varied needs of diverse participants.

Keywords: Call auctions; Consolidated markets; Continuous markets; Electronic trading; Fragmented markets; Hybrid market; Market structure; Order-driven markets; Price discovery; Quote-driven markets (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1007/978-3-030-91231-4_39

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