When a firm switches its listing venue, there is often a significant increase in the number of shareholders and the trading activities. According to Merton [1987], an increased shareholder base improves diversification of risk, which has a positive impact on the stock price. Amihud and Mendelson...

Since the 1990s, fund raising behavior of Japanese companies has significantly changed. We conducted empirical studies based on the companies listed on the First Section of the Tokyo Stock Exchange. Our findings can be summarized as follows. (i) The debt-equity ratio of companies with relatively...

There is a positive cross-country correlation between money growth and inflation rate, and both money growth and inflation rate of Japan are lower than those of other advanced countries. In the"Money view" based on the quantity theory of money, it can be interpreted that Japan's low inflation...

Liquidity in the Japanese government bond (JGB) market has improved significantly as a result of a series of market reforms implemented since 2000. Market liquidity is a measure of "the level of ease with which trading can be conducted in the market." In order to facilitate trading in the JGB...

The Foreign Exchange Operations Section of the Financial Markets Department of the Bank of Japan monitors the foreign exchange market and other global financial markets. In recent years, the relatively sharp price movements observed on global financial markets have generally been accompanied by...

With the lowering volatilities in the foreign exchange and stock markets in recent years and historically low interest rates, investments in hedge funds and investment trusts (Japanese mutual funds) by Japanese investors have been increasing. For both hedge funds and investment trusts, investors...

The Financial Markets Department conducted its second census of stress tests to collect and analyse stress scenarios adopted by market participants. In a sense, the exercise was conceived as a market-wide "fire drill" assuming situations where serious shocks occur in financial markets. Through...

Hedge funds have changed their investment behavior in recent years stimulated, among other things, by large inflows of money and rising stock prices around the world. Database analyses indicate that they are expanding their long positions in equity markets, increasing their investments in...

Closer relationships are now being observed between the uncollateralized call rate, which is heavily influenced by the Bank of Japan's money market operations, and the Euroyen rate and the yen funding rate in the dollar/yen swap market, reflecting more dynamic arbitrage operations by...

One of the most important agendas for the revival of the Japanese economy is to improve direct financing channels for firms. Over the past few months, financial experts were invited to a "Study Group on the Securitization of Small to Medium-sized Enterprises' Receivables," held at the Financial...