Measuring Liquidity in Financial Markets /

This paper provides an overview of indicators that can be used to illustrate and analyze liquidity developments in financial markets. The measures include bid-ask spreads, turnover ratios, and price impact measures. They gauge different aspects of market liquidity, namely tightness (costs), immediac...

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Bibliographic Details
Main Author: Lybek, Tonny
Other Authors: Sarr, Abdourahmane
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2002.
Series:IMF Working Papers; Working Paper ; No. 2002/232
Online Access:Full text available on IMF
Description
Summary:This paper provides an overview of indicators that can be used to illustrate and analyze liquidity developments in financial markets. The measures include bid-ask spreads, turnover ratios, and price impact measures. They gauge different aspects of market liquidity, namely tightness (costs), immediacy, depth, breadth, and resiliency. These measures are applied in selected foreign exchange, money, and capital markets to illustrate their operational usefulness. A number of measures must be considered because there is no single theoretically correct and universally accepted measure to determine a market's degree of liquidity and because market-specific factors and peculiarities must be considered.
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Physical Description:1 online resource (63 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students