Discuss the evolution of the securities markets, including the impact of the NASDAQ, CME, ECNs, and foreign exchanges.
Explain the role of securities markets in the efficient allocation of capital among issuers and investors based on the efficient market hypothesis.
Evaluate if the presence of dark pools enhances or reduces capital market efficiency.
Finally, find a real-life company that has made raised capital in 2020 and discuss the method used. If possible, try to select a company that a fellow student has not already selected.
here is the answer to your question:
The Evolution of the Securities Markets
The securities markets have evolved significantly over time. In the early days, securities were traded over-the-counter (OTC), which meant that buyers and sellers would find each other through a network of brokers. This system was inefficient and slow, and it made it difficult for investors to get a fair price for their securities.
In the 1970s, the NASDAQ was created as an electronic trading platform. This allowed investors to trade securities directly with each other, which made the market more efficient and transparent. The CME was also founded in the 1970s, and it became a major player in the futures and options markets.
In the 1990s, electronic communications networks (ECNs) were created. These networks allowed investors to trade securities directly with each other, without the need for a broker. ECNs made the market even more efficient and transparent, and they helped to reduce the cost of trading securities.
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