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Czech experience with market maker trading system

Publication at Faculty of Social Sciences, Faculty of Mathematics and Physics, Centre for Economic Research and Graduate Education |
2004

Abstract

We study the evolution of trading in a market maker trading system (SPAD) introduced to the Prague Stock Exchange in 1998. We find that the new system succeeded in increasing the transparency of the market, improved the price discovery function of the exchange, and that investors have benefited from lowered spreads.