Essays on the economics of equity trading

The first chapter reviews the existing literature on the Economics of the Stock Exchanges. The review describes the services provided by the Stcok Exchanges and the different components of a trade. The main focus is on the forces of aglommeration and fragmentation that characterize the process of trading and listing. If finalizes with a historical descrition of the evolution of the Stock Exchanges, in their form of organization and trends for the number of exchanges in operation.;The second paper (writen with Bryan Lim), The performance and impact of stock picks mentioned on "Mad Money, the market reaction and the long-term returns of stock picks mentioned on the CNBC program "Mad Money", hosted by former hedge fund manager Jim Cramer is analysed in detail. We find that Cramer's stock-picking style is consistent with a positive-feedback trading strategy, favoring stocks which have outperformed over an interval prior to the pick date. Subsequent to a pick, Cramer's immediate effect on a stock appears inversely proportional to the corresponding firm's market capitalization. The returns over a six-month horizon provide some evidence in favor of Cramer's stock-picking ability. In particular, his recommendations on small-cap stocks accurately predict the long-run trends.;The third paper, Listing Standards and the Listing Decisions of Firms, develops a model that makes the link between the listing standards imposed on firms to list in the exchange and the listing decisions of firms, in a context of a model of international financial flows. The model suggests that financial integration will lead to an improvement of listing standards. However, setting those listing standards too high may have a negative effect and induce the exit of firms from the exchange.