Broking and Market Making (FINC6003)
UNIT OF STUDY
Brokers and market makers play a critical role in the operation of capital markets. In this unit, we start by providing an overview of capital markets around the globe and an outline of the financial product types available. We then address the functions of brokers and market makers, how their performance is evaluated, how they help to make markets more efficient and when their actions lower market quality. The ever changing role of brokers and market makers in a changing financial landscape is examined using academic research literature that focusses on issues that are important to these financial intermediaries. The course emphasises theory and empirical literature dealing with price formation, information dissemination and trading in limit order book markets, which are becoming the market design of choice. We also look in detail at the recent phenomena of market fragmentation and high frequency trading.
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Further unit of study information
1x 3hr seminar per week
mid-semester exam (15%), class participation (5%), multiple choice question construction (5%), individual article annotation (10%), major assignment (20%), and final exam (45%)
Faculty/department permission required?
Unit of study rules
Prerequisites and assumed knowledge
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