The over-the-counter market consists of several segments, the two most important being the NASDAQ and the NASDAQ/NMS. Each year, many companies switch from one segment to another. The evidence shows that moving from NASDAQ to NASDAQ/NMS tightens spreads and increases volume. These results suggest that NMS inclusion enhances liquidity by lowering transaction costs.
Read the Complete Article in Financial Analysts Journal
Financial Analysts Journal
CFA Institute Member ContentPublisher Information
Association for Investment Management and Researchdoi.org/10.2469/faj.v48.n1.83ISSN/ISBN: 0015-198X
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