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Tokenized stocks and tracking errors: Evidence on pricing efficiency

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  • Mazur, Mieszko
  • Polyzos, Efstathios

Abstract

Tokenized stocks emerge as an innovative gateway to the ownership of foreign assets that otherwise would not be accessible to many investors worldwide. In this paper, we investigate whether tokenized stocks are priced efficiently based on the analysis of tracking errors that may arise between tokenized and traditional stocks. We find that tracking errors increase with return volatility, market-wide uncertainty and weaker alignment between token and equity returns. Moreover, mis-tracking is more pronounced for firms with higher valuations, greater market risk exposure, and elevated short-selling activity.

Suggested Citation

  • Mazur, Mieszko & Polyzos, Efstathios, 2026. "Tokenized stocks and tracking errors: Evidence on pricing efficiency," Finance Research Letters, Elsevier, vol. 106(C).
    • Handle: RePEc:eee:finlet:v:106:y:2026:i:c:s1544612326007294
    DOI: 10.1016/j.frl.2026.110201
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