Where is the Market? Evidence from Cross-Listings

29 Pages Posted: 23 Jun 2004

See all articles by Michael Halling

Michael Halling

University of Vienna - Department of Business Engineering

Marco Pagano

University of Naples Federico II - Department of Economics and Statistics; Centre for Studies in Economics and Finance (CSEF); Einaudi Institute for Economics and Finance (EIEF); Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

Otto Randl

WU Vienna University of Economics and Business

Josef Zechner

Vienna University of Economics and Business

Multiple version iconThere are 2 versions of this paper

Date Written: March 15, 2004

Abstract

We investigate the distribution of trading volume across different venues after a company lists abroad. In most cases, after an initial blip, foreign trading declines rapidly to extremely low levels. However, there is considerable cross-sectional variation in the persistence and magnitude of foreign trading. The ratio between foreign and domestic trading volume is higher for smaller, more export and high-tech oriented companies. It is also higher for companies that cross-list on markets with lower trading costs and better insider trading protection. Domestic trading increases around the cross-listing, and afterwards is negatively correlated with past foreign trading activity. This accords with the flow-back hypothesis that declining foreign trading is associated with the gravitational pull of the home market.

Keywords: trading volume, cross-listing, flow-back

JEL Classification: G15, G30

Suggested Citation

Halling, Michael and Pagano, Marco and Randl, Otto and Zechner, Josef, Where is the Market? Evidence from Cross-Listings (March 15, 2004). EFA 2004 Maastricht Meetings Paper No. 4399. Available at SSRN: https://ssrn.com/abstract=556105 or http://dx.doi.org/10.2139/ssrn.556105

Michael Halling (Contact Author)

University of Vienna - Department of Business Engineering ( email )

Bruenner Strasse 72
Vienna 1210, Vienna
Austria
+43 1 4277 38081 (Phone)
+43 1 4277 38074 (Fax)

HOME PAGE: http://www.sea.uni-linz.ac.at/Department/Staff/mhalling/

Marco Pagano

University of Naples Federico II - Department of Economics and Statistics ( email )

Via Cintia - Monte S. Angelo
Napoli, 80126
Italy
+39 081 675306 (Phone)
+39 081 7663540 (Fax)

Centre for Studies in Economics and Finance (CSEF) ( email )

Via Cintia
Complesso Monte S. Angelo
Naples, Naples 80126
Italy

Einaudi Institute for Economics and Finance (EIEF)

Via Sallustiana, 62
Rome, 00187
Italy

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

HOME PAGE: http:/www.ecgi.org

Otto Randl

WU Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, 1020
Austria
+ 43 1 313 36 - 5076 (Phone)

Josef Zechner

Vienna University of Economics and Business ( email )

Welthandelsplatz 1
Vienna, Wien A-1019
Austria

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