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The curious case of changes in trading dynamics: When firms switch from NYSE to NASDAQ

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  • Dang, Viet Anh
  • Michayluk, David
  • Pham, Thu Phuong

Abstract

Voluntarily switching trading location from the New York Stock Exchange to the NASDAQ is a new phenomenon, with 53 companies making the switch since 2000. We examine the stated reasons for the move and investigate the consistency with the subsequent market dynamics, including effects on liquidity, trading activity, and visibility. We find the move to the NASDAQ increases trading costs, improves visibility, attracts more liquidity providers in the long term, explaining the subsequent increase in trading volume and supporting many of the management statements justifying the move. Our findings suggest multi-dimensional aspects may be important considerations in moves between exchanges.

Suggested Citation

  • Dang, Viet Anh & Michayluk, David & Pham, Thu Phuong, 2018. "The curious case of changes in trading dynamics: When firms switch from NYSE to NASDAQ," Journal of Financial Markets, Elsevier, vol. 41(C), pages 17-35.
  • Handle: RePEc:eee:finmar:v:41:y:2018:i:c:p:17-35
    DOI: 10.1016/j.finmar.2018.07.001
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    References listed on IDEAS

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    Cited by:

    1. Y. Peter Chung & S. Thomas Kim & Kenji Kutsuna & Richard L. Smith, 2020. "Which firms benefit from market making?," Financial Markets and Portfolio Management, Springer;Swiss Society for Financial Market Research, vol. 34(1), pages 33-63, March.

    More about this item

    Keywords

    Trading costs; Volume; Exchange listing; NYSE; NASDAQ;

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation

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