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Impact of MiFID II on Romanian Stock Market Liquidity—Comparative Analysis with a Developed Stock Market

Author

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  • Marius Cristian Miloș

    (Department of Finance, Faculty of Economics and Business Administration, West University of Timișoara, 16 Pestalozzi Street, 300115 Timișoara, Romania
    ECREB, Faculty of Economics and Business Administration, West University of Timișoara, 16 Pestalozzi Street, 300115 Timișoara, Romania)

  • Laura Raisa Miloș

    (Department of Finance, Faculty of Economics and Business Administration, West University of Timișoara, 16 Pestalozzi Street, 300115 Timișoara, Romania)

  • Flavia Barna

    (Department of Finance, Faculty of Economics and Business Administration, West University of Timișoara, 16 Pestalozzi Street, 300115 Timișoara, Romania)

  • Claudiu Boțoc

    (Department of Finance, Faculty of Economics and Business Administration, West University of Timișoara, 16 Pestalozzi Street, 300115 Timișoara, Romania)

Abstract

In light of previous literature that has investigated the effects of MiFID and MiFID II regulation on stock market liquidity, we investigate whether the introduction of MiFID II in Romania has had any effect on the stock market liquidity. Through our empirical analysis, we were able to estimate a meaningful reduction of liquidity in the Romanian stock market liquidity, in response to MiFID II, in line with the previous empirical literature. We find that the liquidity of the BET index constituents has decreased in the period following MiFID II. We find contradictory results in what concerns the German stock market, which could be explained by the different level of development of the stock markets and of the financial education of investors.

Suggested Citation

  • Marius Cristian Miloș & Laura Raisa Miloș & Flavia Barna & Claudiu Boțoc, 2021. "Impact of MiFID II on Romanian Stock Market Liquidity—Comparative Analysis with a Developed Stock Market," IJFS, MDPI, vol. 9(4), pages 1-18, December.
    • Handle: RePEc:gam:jijfss:v:9:y:2021:i:4:p:69-:d:697796
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    References listed on IDEAS

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    Cited by:

    1. Jakub Kubiczek & Marcin Tuszkiewicz, 2022. "Intraday Patterns of Liquidity on the Warsaw Stock Exchange before and after the Outbreak of the COVID-19 Pandemic," IJFS, MDPI, vol. 10(1), pages 1-16, February.

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