Trading and Exchanges Market Microstructure for Practitioners Financial Management Association Survey and Synthesis Series

This book is about trading, the people who trade securities and contracts, the marketplaces where they trade, and the rules that govern it. Readers will learn about investors, brokers, dealers, arbitrageurs, retail traders, day traders, rogue traders, and gamblers; exchanges, boards of trade, dealer networks, ECNs (electronic communications networks), crossing markets, and pink sheets. Also covered in this text are single price auctions, open outcry auctions, and brokered markets limit orders, market orders, and stop orders. Finally, the author covers the areas of program trades, block trades, and short trades, price priority, time precedence, public order precedence, and display precedence, insider trading, scalping, and bluffing, and investing, speculating, and gambling.

1: Introduction, 2: Trading Stories, Part. Part 1: The Structure of Trading. 3: The Trading Industry, 4: Orders and Order Properties, 5: Market Structures, 6: Order-Driven Market Mechanisms, 7: Brokers, Part. Part 2: The Benefits of Trade. 8: Why People Trade, 9: Good Markets, Part. Part 3: Speculators. 10: Informed Traders and Market Efficiency, 11: Order Anticipators, 12: Bluffing and Price Manipulation, Part. Part 4: Liquidity Suppliers. 13: Dealers, 14: Bid/Ask Spreads, 15: Block Trading, 16: Value-Motivated Trainers, 17: Arbitrage, 18: Buy-side Trading Strategies, Part. Part 5: Origins of Liquidity and Volatility. 19: Understanding Liquidity, 20: Understanding Volatility, Part. Part 6: Evaluation and Prediction. 21: Measuring Liquidity and Transaction Costs, 22: Performance Evaluation and Prediction, Part. Part 7: Market Structures. 23: Index and Portfolio Markets, 24: Specialists, 25: Internalization, Preferencing, and Crossing, 26: Competition within and among Markets, 27: Floor versus Automated Trading Systems, 28: Bubbles, Crashes, and Circuit Breakers, 29: Insider Trading, 30: Summary of Market Microstructure