Global Financial Networks and Trading in Emerging Bond Markets
In a global economic environment the interest rate in an open economy depends on not only domestic economic activities but also worldwide economic situations. Financial institutions with a global financial network can more efficiently acquire and process information on the interest rate of an open economy, which affords these global financial institutions advantage in trading government bonds---the most interest rate sensitive asset. Using transaction level data on Turkish government bond trading, we find that financial institutions with global financial networks exhibit a stronger tendency to trade in the more liquid bonds, consistently trade at more favorable prices, and enjoy better trading performance than local financial institutions (both large and small). We also find that all financial institutions hold bond positions with losses longer than with gains but the effect is weaker for global financial institutions than for local financial institutions. Collectively, these results suggest that global financial institutions have superior information and benefit from bond trading in an open emerging market.
Global Financial Networks Information Emerging Bond Markets
G. Geoffrey Booth Umit G. Gurun Harold H. Zhang
Eli Broad Graduate School of Management Michigan State University School of Management University of Texas at Dallas
国际会议
大连
英文
1-49
2008-07-02（万方平台首次上网日期，不代表论文的发表时间）