{"product_id":"market-liquidity-theory-evidence-and-policy-9780199936243","title":"Market Liquidity: Theory  Evidence  and Policy","description":"\u003cp\u003eThe way in which securities are traded is very different from the idealized picture of a frictionless and self-equilibrating market offered by the typical finance textbook. Market Liquidity offers a more accurate and authoritative take on liquidity and price discovery. The authors start from the assumption that not everyone is present at all times simultaneously on the market  and that even the limited number of participants who are have quite diverse information about the securitys fundamentals. As a result  the order flow is a complex mix of information and noise  and a consensus price only emerges gradually over time as the trading process evolves and the participants interpret the actions of other traders. Thus a securitys actual transaction price may deviate from its fundamental value  as it would be assessed by a fully informed set of investors.  This book takes these deviations seriously  and explains why and how they emerge in the trading process and are eventually eliminated. The authors draw on a vast body of theoretical insights and empirical findings on security price formation that have accumulated in the last thirty years  and have come to form a well-defined field within financial economics known as \"market microstructure.\" Focusing on liquidity and price discovery  they analyze the tension between the two  pointing out that when price-relevant information reaches the market through trading pressure rather than through a public announcement  liquidity suffers.  The book also confronts many puzzling phenomena in securities markets and uses the analytical tools and empirical methods of market microstructure to understand them. These include issues such as why liquidity changes over time  why large trades move prices up or down  and why these price changes are subsequently reversed  why we see concentration of securities trading  why some traders willingly disclose their intended trades while others hide them  and why we observe temporary deviations from arbitrage prices.\u003c\/p\u003e","brand":"My Store","offers":[{"title":"Default Title","offer_id":45652175224885,"sku":"ByrdShop_0199936242","price":94.4,"currency_code":"USD","in_stock":true}],"thumbnail_url":"\/\/cdn.shopify.com\/s\/files\/1\/0627\/8139\/0901\/files\/9780199936243.jpg?v=1781849728","url":"https:\/\/atxbooks.com\/products\/market-liquidity-theory-evidence-and-policy-9780199936243","provider":"ATX Books","version":"1.0","type":"link"}