The Financial Review, Forthcoming
18 Pages Posted: 28 Jul 2010 Last revised: 9 Aug 2015
Date Written: January 10, 2013
We survey empirical studies on the development and effects of increased computerization across equity, foreign exchange, derivatives, and fixed-income markets. While the changes in the trading process due to computerization in less liquid markets such as the corporate bond market have been modest, there have been dramatic changes in certain derivatives markets, foreign exchange, and in particular equity markets. In many instances, previous research has found positive effects of computerization on measures of market quality, but our survey highlights that human intermediation is still prominent and beneficial in certain areas.
Keywords: automation, electronic trading, computerized trading, human intermediation
JEL Classification: G1, G2
Suggested Citation: Suggested Citation
Cardella, Laura and Hao, Jia and Kalcheva, Ivalina and Ma, Yung-Yu, Computerization of the Equity, Foreign Exchange, Derivatives, and Fixed Income Markets (January 10, 2013). The Financial Review, Forthcoming . Available at SSRN: https://ssrn.com/abstract=1650345 or http://dx.doi.org/10.2139/ssrn.1650345