Exchange Trading Rules and Stock Market Liquidity
41 Pages Posted: 16 Jan 2009 Last revised: 22 Nov 2014
Date Written: January 1, 2009
This paper examines stock exchange trading rules for market manipulation, insider trading and broker agency conduct across countries and over time for 42 stock exchanges around the world. Some stock exchanges have extremely detailed rules which explicitly prohibit specific manipulative practices, while others use less precise and broadly framed rules. We create new indices for market manipulation, insider trading and broker-agency conduct based on the specific provisions in the exchange trading rules of each stock exchange. We show differences in exchange trading rules over time and across markets significantly affect trading activity.
Keywords: Market Manipulation, Insider Trading, Broker Agency Conduct, Law and Finance
JEL Classification: G12, G14, G18, K22
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