Competition for Order Flow and the Theory of Global Games

The impact of alternative trading systems on securities markets

  • Authors
  • Jutta A. Dönges

Table of contents

  1. Front Matter
    Pages I-XXXIV
  2. Jutta A. Dönges
    Pages 1-8
  3. Jutta A. Dönges
    Pages 9-58
  4. Jutta A. Dönges
    Pages 103-148
  5. Jutta A. Dönges
    Pages 149-206
  6. Jutta A. Dönges
    Pages 207-213
  7. Back Matter
    Pages 215-273

About this book

Introduction

The proliferation of alternative trading systems has increased competition for order flow in financial markets significantly and renewed the debate on fragmentation versus consolidation. Market microstructure models that analyze liquidity-based intermarket competition typically exhibit multiple equilibria, making it difficult to determine whether fragmentation or consolidation of order flow will occur.

Jutta A. Dönges applies the recently developed theory of global games that
reduces multiplicity of equilibria in coordination games to a model of intermarket competition and demonstrates the existence of a unique equilibrium under fairly general conditions. The author investigates whether and under which circumstances alternative trading systems, particularly crossing networks, can co-exist with established markets or even replace them and explores how the introduction of a crossing network affects both
monopolistic and competitive dealer markets and the market participants'
behavior.

Keywords

Aktienmarkt Crossing Networks Distribution Finanzmarkt Handel Informationstechnik (IT) Marktwettbewerb Pricing Spieltheorie Stock Markets Stock market Trading Tradingsysteme Wettbewerb alternative trading system

Bibliographic information

  • DOI https://doi.org/10.1007/978-3-663-07734-3
  • Copyright Information Gabler Verlag | Springer Fachmedien Wiesbaden GmbH, Wiesbaden 2001
  • Publisher Name Deutscher Universitätsverlag, Wiesbaden
  • eBook Packages Springer Book Archive
  • Print ISBN 978-3-8244-7426-4
  • Online ISBN 978-3-663-07734-3
  • About this book
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