Stock Market Liquidity in Chile
November 16, 2016
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Order a Print CopyDisclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
Summary
Chile has a large but relatively illiquid stock market. Global factors such as global risk appetite and monetary policy in advanced economies are key cyclical determinants of liquidity in Chilean equities. Evidence from a cross-section of emerging markets suggests strong protection of minority shareholders can help improve stock market liquitidity. Currently, illiquid in Chilean may have to pay 3½ percent more as cost of equity. Corporate governance should be improved, namely through the adoption of a stewardship code.
Subject: Asset and liability management, Corporate governance, Economic sectors, Financial institutions, Financial markets, Liquidity, Liquidity indicators, Liquidity management, Stock markets, Stocks
Keywords: aggregate liquidity, corporate governance, Global, investor protection, Liquidity, liquidity cost, Liquidity management, liquidity premium, liquidity regime, liquidity service, market liquidity, Stock markets, Stocks, WP
Pages:
29
Volume:
2016
DOI:
Issue:
223
Series:
Working Paper No. 2016/223
Stock No:
WPIEA2016223
ISBN:
9781475554656
ISSN:
1018-5941
