An Analysis of Topical Issue in Today’s Financial Markets

DOI

10.2991/978-94-6463-298-9_57How to use a DOI?

Keywords

dealers; market maker; liquidity; volatility; stock market; commodity market; inflation; interest rate

Abstract

This report delves into a contemporary concern within the financial market, namely, the challenges faced by dealers, also known as market makers, in today’s financial landscape. The primary objective of this report is to critically examine the value that dealers bring to the market and their true capacity to provide liquidity. Additionally, it conducts an in-depth analysis of the principal factors influencing short-term volatility. Market makers, or dealers, play a pivotal role in fostering liquidity within the financial market and contribute significantly to its long-term growth trajectory. Their adeptness at managing market risks empowers them to continue trading even during periods of market downturns, consequently enhancing the overall attractiveness and liquidity of the market. However, it is imperative to scrutinize whether dealers, driven by profit maximization, may sometimes prioritize personal gain at the expense of their liquidity-providing role. Furthermore, it is noteworthy that the underlying assets in stock markets and commodity markets are fundamentally distinct, leading to disparate causes of volatility in these two domains. On the other hand, there exist common determinants that transcend asset types, such as inflation trends, short-term interest rates, and market sentiment. These factors serve as crucial elements for forecasting short-term volatility in both equities and commodities markets, exerting an identical influence on these distinct market segments.

Copyright

© 2023 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Ning Wang
PY  - 2023
DA  - 2023/11/30
TI  - An Analysis of Topical Issue in Today’s Financial Markets
BT  - Proceedings of the 2023 International Conference on Finance, Trade and Business Management (FTBM 2023)
PB  - Atlantis Press
SP  - 528
EP  - 534
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-298-9_57
DO  - 10.2991/978-94-6463-298-9_57
ID  - Wang2023
ER  -