This study shows that options listing significantly affects the spreads on the underlying stock. The authors identify a trade-off between the benefits of increased liquidity and the cost of informational externalities. Highly liquid stocks tend to have spread increases, while illiquid stocks...

This article investigates the importance of risk exposure and the effects of the 1984 Tax Reform Act on the ex-dividend day behavior. The tax reform appears to have inhibited short-term trading activities by increasing the risk exposure of incorporated traders. Moreover, stocks for which...