Option Introduction and Liquidity Changes in the OTC/NASDAQ Equity Market

This paper examines the impact of option listing in the NASDAQ equity market on the bid-ask spread of the underlying stock. We find that both the market adjusted percentage and dollar spreads decrease with option listing, which is consistent with a value enhancing impact of derivative security introduction.

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Year of publication:	1992
Authors:	Fortin, Rich ; Maese, Judy
Published in:	Journal of Small Business Finance. - Greenwich, CT : JAI Press, ISSN 1057-2287. - Vol. 2.1992, 1, p. 39-52
Publisher:	Greenwich, CT : JAI Press
Subject:	NASDAQ \| Nasdaq \| Options \| OTC \| Liquidity

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Type of publication:	Article
Type of publication (narrower categories):	Article
Language:	English
Other identifiers:	hdl:10419/114646 [Handle] RePEc:pep:journl:v:2:y:1992:i:1:p:39-52 [RePEc]
Classification:	G13 - Contingent Pricing; Futures Pricing ; G12 - Asset Pricing
Source:	EconStor

Persistent link: https://www.econbiz.de/10011310309