An Analysis of the Impact of Demutualization on Stock Market Liquidity

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dc.contributor.authorNyangara, Davis
dc.contributor.authorMazviona, Batsirai Winmore
dc.date.accessioned2015-12-08T09:03:48Z
dc.date.accessioned2023-06-26T12:08:44Z
dc.date.available2015-12-08T09:03:48Z
dc.date.available2023-06-26T12:08:44Z
dc.date.issued2014
dc.descriptionAn Open Access Research Articleen_US
dc.description.abstractThis paper analyzes the impact of demutualization on stock market liquidity using annual data available from 24 demutualized and 26 mutual stock exchanges for the period 1990 to 2011. We use a panel data regression model to examine the nature and significance of the relationship between stock exchange demutualization and two measures of stock market liquidity (turnover rate and the value of volume traded relative to Gross Domestic Product (GDP). The findings indicate that demutualized exchanges exhibit significantly greater liquidity compared to mutual exchanges after controlling for age, size, trading technology, and level of economic development. We also observe that, world-wide, the trend has been that automation of trading precedes demutualization, and that the time between automation and demutualization has a positive but statistically insignificant effect on liquidity. The study is a remarkable departure from the traditional focus on the exchange governance effects of demutualization. Furthermore, it contributes to the literature on financial market development by documenting some of the key drivers of stock market liquidity, which in itself is a widely acknowledged driver of economic growth.en_US
dc.identifier.citationNyangara, D. Mazviona, B. W. 2014.An Analysis of the Impact of Demutualization on Stock Market Liquidity. International Journal of Economics and Management Sciences 2014, 3:1en_US
dc.identifier.urihttp://196.220.97.103:4000/handle/123456789/589
dc.language.isoenen_US
dc.publisherOMICS Publishing Groupen_US
dc.relation.ispartofseriesInternational Journal of Economics and Management Sciences;3 (1)
dc.subjectDemutualizationen_US
dc.subjectStock exchangeen_US
dc.subjectLiquidityen_US
dc.subjectAutomationen_US
dc.titleAn Analysis of the Impact of Demutualization on Stock Market Liquidityen_US
dc.typeArticleen_US
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