Chapter

Stock Trading in Space and Time: Information and Prices around the Globe

Dariusz Wójcik

in The Global Stock Market

Published in print May 2011 | ISBN: 9780199592180
Published online September 2011 | e-ISBN: 9780191729089 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199592180.003.0005
Stock Trading in Space and Time: Information and Prices around the Globe

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With continued focus on investors, Chapter 5 investigates the circulation of information on secondary stock markets, using the case study of HSBC shares traded on the exchanges in New York, London, and Hong Kong. The distribution of price discovery is analysed across the three markets, within a 24-hour cycle of trading, and in the period between 2006 and 2009. London, the seat of HSBC headquarters, home to most of its decision makers and key business relationships, dominates price discovery. Hong Kong, the former home of HSBC and hub of its Asian operations is second. New York, unable to rival London or Hong Kong's access to private information about HSBC, is last. Its role in price formation was particularly weak during the financial crisis, when confidence in publicly available information was at its lowest.

Keywords: stock trading; financial crisis; private information; stock prices; investors; HSBC; New York; London; Hong Kong; price discovery

Chapter.  8633 words.  Illustrated.

Subjects: Financial Institutions and Services

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