This paper investigates whether, as a result of competition, certain explicit transaction costs (... more This paper investigates whether, as a result of competition, certain explicit transaction costs (execution fees) paid by broker-dealers to execute client orders on trading platforms are effectively decreasing, and considers the implications for stock exchanges and equity markets. It aims to integrate the literature on trading costs in equity markets by focusing on qualitative aspects and their specific relevance to the assessment of securities market quality, considering that in a high quality market, transaction costs are low. Changes in the price lists of the major European stock exchanges and multilateral trading facilities (MTFs) are examined to highlight the main pricing policy trends. In line with the prevailing literature, trading fees paid by brokers on these platforms are compared. The decrease in execution fees has coincided with a fall in trading revenues; lower revenues may undermine the profitability and long term stability of stock exchanges, and have a negative impact on equity market quality. It emerges that stock exchanges are progressively diversifying their business, increasing other sources of income to compensate for the loss of trading revenues.The findings relate largely to the period 2008 \u2013 first half 2012
Equity trading in the world is dramatically changing and at the same time raising doubts as to bo... more Equity trading in the world is dramatically changing and at the same time raising doubts as to both its quality (liquidity, price efficiency and volatility) and its integrity; the change is mainly due to two factors: the first is fiercer competition, both among trading venues and between trading venues and intermediaries; the second is the increasingly significant role of technology in trading processes. Fiercer competition has primarily been the result of regulation. The second factor, technology, is significant in so far as the algorithms used by some traders have changed the operating procedures underlying the execution of orders. While advances in technology are a natural evolution of the market, they have a major impact on market structures. In particular, in the event of network outages or flash crashes, doubts arise in relation to the market integrity and the existence of a level playing field, since technology is expensive and not equally accessible to all traders.
HFT has become one of the greatest concerns of the securities industry in recent years, mainly fo... more HFT has become one of the greatest concerns of the securities industry in recent years, mainly for supposedly profiting at the expense of traditional investors and exacerbating volatility. This paper examines the differences among the recent proposed regulations on HFT worldwide by comparing several recent approaches by national regulators and by ESMA and SEC
We propose a model according to knowledge-based theory to explain how digitalization impacts bank... more We propose a model according to knowledge-based theory to explain how digitalization impacts bank performance. We identify four resources and capabilities from the digitalization process that create sustainable competitive advantage: Digital market-learning capabilities, Digital organizational capabilities, Digital technical capabilities and Digital industry forces. For a sample of 96 large listed US banks from 2007-2017, we create a unique multisource new dataset (Annual reports, Bloomberg, World Bank, and OECD EMI) that allows mapping of the digitalization of the US banking industry and testing of the proposed model. The results from empirical analysis demonstrate that digitalization positively affects bank profitability; specifically, digitalization leads to sustainable competitive advantages for banks through Digital market-learning capabilities, Digital organizational capabilities and Digital technical capabilities. Furthermore, we provide evidence that banks replace employees and branches with digitalization
The improvements of the financial markets and the new supervisory rules about the large exposures... more The improvements of the financial markets and the new supervisory rules about the large exposures could help banks to improve the financing of the firm. This paper examines many factors which were different in the Italian banking systems and in the Italian financial system in comparison to the other nations
L'elaborato intende analizzare l'evoluzione delle fees nelle principali infrastrutture de... more L'elaborato intende analizzare l'evoluzione delle fees nelle principali infrastrutture del trading e del post-trading in Europa
Il paper mira a descrivere la dinamica dei costi di transazione nei servizi di trading mettendo i... more Il paper mira a descrivere la dinamica dei costi di transazione nei servizi di trading mettendo in luce come detti costi siano importanti per la qualit\ue0 e l'efficienza dei mercati azionari
Palgrave Macmillan Studies in Banking and Financial Institutions, 2019
Banks are increasingly using online social media to engage with their existing and potential cust... more Banks are increasingly using online social media to engage with their existing and potential customers; however, the use of technology can both strengthen and weaken these ‘virtual’ relationships. We analyse the adoption of online social media for 151 Italian banks and test how it affected bank profitability in 2013–2016. Although the adoption rate is lower than what is required by customers, and banks’ popularity on online social media is poor, we find that the effects of online social media vary. In particular, the presence and popularity of banks on Facebook negatively affect their profitability, whereas their presence on YouTube and in interactions on LinkedIn increases bank performance.
Di fronte a pericolose risorgenze di euroscetticismo, declinato in diverse manifestazioni e da di... more Di fronte a pericolose risorgenze di euroscetticismo, declinato in diverse manifestazioni e da diverse ali politiche, sia nei pi\uf9 recenti membri dell\u2019Unione Europea che tra gli stessi membri fondatori (pensiamo proprio all\u2019Italia), la Banca Centrale Europea a nostro avviso ha giocato il ruolo di collante in un momento di crisi economica profonda e incapacit\ue0 di avviare nuove politiche cooperative. A partire dall\u2019ottobre del 2008 il Consiglio direttivo della BCE ha messo in campo numerose misure non convenzionali, ope-razioni di rifinanziamento, crediti a lungo termine per le banche commerciali dell\u2019area euro, allentamento monetario(acquisto di titoli pubblici e privati per 60 e poi 80 miliardi al mese) al fine di sostenere banche e Paesi in difficolt\ue0. La BCE ha finito per assumere il ruolo di lender of last resort e dal 2013 si \ue8 fatta paladina di una vera e propria rivoluzione normativa che ha introdotto l\u2019Unione Bancaria
Article history: This draft: 15 Jan. 2018 A digital revolution is changing our social and economi... more Article history: This draft: 15 Jan. 2018 A digital revolution is changing our social and economic lives and also financial institutions have virtually no other alternative but to adapt their traditional business practices to digital structural change. In this paper we analyse the effects of the digitalization of the financial sector on bank performance in Europe in the years 2000-2015. Through a statistical regression model, we test the relationship between the main indicators of investments in Intellectual Property Products and ICT equipment and the bank interest spread at national aggregate level. Our results demonstrate that investments in digitalization have a positive effect on bank profitability. Also the presence of Automatic Teller Machines (ATMs) still conduce to an enhance of income for banks and financial companies; conversely, the presence of physical branches has no effects. EFM Classification code: 510 Depository
This paper investigates whether, as a result of competition, certain explicit transaction costs (... more This paper investigates whether, as a result of competition, certain explicit transaction costs (execution fees) paid by broker-dealers to execute client orders on trading platforms are effectively decreasing, and considers the implications for stock exchanges and equity markets. It aims to integrate the literature on trading costs in equity markets by focusing on qualitative aspects and their specific relevance to the assessment of securities market quality, considering that in a high quality market, transaction costs are low. Changes in the price lists of the major European stock exchanges and multilateral trading facilities (MTFs) are examined to highlight the main pricing policy trends. In line with the prevailing literature, trading fees paid by brokers on these platforms are compared. The decrease in execution fees has coincided with a fall in trading revenues; lower revenues may undermine the profitability and long term stability of stock exchanges, and have a negative impact on equity market quality. It emerges that stock exchanges are progressively diversifying their business, increasing other sources of income to compensate for the loss of trading revenues.The findings relate largely to the period 2008 \u2013 first half 2012
Equity trading in the world is dramatically changing and at the same time raising doubts as to bo... more Equity trading in the world is dramatically changing and at the same time raising doubts as to both its quality (liquidity, price efficiency and volatility) and its integrity; the change is mainly due to two factors: the first is fiercer competition, both among trading venues and between trading venues and intermediaries; the second is the increasingly significant role of technology in trading processes. Fiercer competition has primarily been the result of regulation. The second factor, technology, is significant in so far as the algorithms used by some traders have changed the operating procedures underlying the execution of orders. While advances in technology are a natural evolution of the market, they have a major impact on market structures. In particular, in the event of network outages or flash crashes, doubts arise in relation to the market integrity and the existence of a level playing field, since technology is expensive and not equally accessible to all traders.
HFT has become one of the greatest concerns of the securities industry in recent years, mainly fo... more HFT has become one of the greatest concerns of the securities industry in recent years, mainly for supposedly profiting at the expense of traditional investors and exacerbating volatility. This paper examines the differences among the recent proposed regulations on HFT worldwide by comparing several recent approaches by national regulators and by ESMA and SEC
We propose a model according to knowledge-based theory to explain how digitalization impacts bank... more We propose a model according to knowledge-based theory to explain how digitalization impacts bank performance. We identify four resources and capabilities from the digitalization process that create sustainable competitive advantage: Digital market-learning capabilities, Digital organizational capabilities, Digital technical capabilities and Digital industry forces. For a sample of 96 large listed US banks from 2007-2017, we create a unique multisource new dataset (Annual reports, Bloomberg, World Bank, and OECD EMI) that allows mapping of the digitalization of the US banking industry and testing of the proposed model. The results from empirical analysis demonstrate that digitalization positively affects bank profitability; specifically, digitalization leads to sustainable competitive advantages for banks through Digital market-learning capabilities, Digital organizational capabilities and Digital technical capabilities. Furthermore, we provide evidence that banks replace employees and branches with digitalization
The improvements of the financial markets and the new supervisory rules about the large exposures... more The improvements of the financial markets and the new supervisory rules about the large exposures could help banks to improve the financing of the firm. This paper examines many factors which were different in the Italian banking systems and in the Italian financial system in comparison to the other nations
L'elaborato intende analizzare l'evoluzione delle fees nelle principali infrastrutture de... more L'elaborato intende analizzare l'evoluzione delle fees nelle principali infrastrutture del trading e del post-trading in Europa
Il paper mira a descrivere la dinamica dei costi di transazione nei servizi di trading mettendo i... more Il paper mira a descrivere la dinamica dei costi di transazione nei servizi di trading mettendo in luce come detti costi siano importanti per la qualit\ue0 e l'efficienza dei mercati azionari
Palgrave Macmillan Studies in Banking and Financial Institutions, 2019
Banks are increasingly using online social media to engage with their existing and potential cust... more Banks are increasingly using online social media to engage with their existing and potential customers; however, the use of technology can both strengthen and weaken these ‘virtual’ relationships. We analyse the adoption of online social media for 151 Italian banks and test how it affected bank profitability in 2013–2016. Although the adoption rate is lower than what is required by customers, and banks’ popularity on online social media is poor, we find that the effects of online social media vary. In particular, the presence and popularity of banks on Facebook negatively affect their profitability, whereas their presence on YouTube and in interactions on LinkedIn increases bank performance.
Di fronte a pericolose risorgenze di euroscetticismo, declinato in diverse manifestazioni e da di... more Di fronte a pericolose risorgenze di euroscetticismo, declinato in diverse manifestazioni e da diverse ali politiche, sia nei pi\uf9 recenti membri dell\u2019Unione Europea che tra gli stessi membri fondatori (pensiamo proprio all\u2019Italia), la Banca Centrale Europea a nostro avviso ha giocato il ruolo di collante in un momento di crisi economica profonda e incapacit\ue0 di avviare nuove politiche cooperative. A partire dall\u2019ottobre del 2008 il Consiglio direttivo della BCE ha messo in campo numerose misure non convenzionali, ope-razioni di rifinanziamento, crediti a lungo termine per le banche commerciali dell\u2019area euro, allentamento monetario(acquisto di titoli pubblici e privati per 60 e poi 80 miliardi al mese) al fine di sostenere banche e Paesi in difficolt\ue0. La BCE ha finito per assumere il ruolo di lender of last resort e dal 2013 si \ue8 fatta paladina di una vera e propria rivoluzione normativa che ha introdotto l\u2019Unione Bancaria
Article history: This draft: 15 Jan. 2018 A digital revolution is changing our social and economi... more Article history: This draft: 15 Jan. 2018 A digital revolution is changing our social and economic lives and also financial institutions have virtually no other alternative but to adapt their traditional business practices to digital structural change. In this paper we analyse the effects of the digitalization of the financial sector on bank performance in Europe in the years 2000-2015. Through a statistical regression model, we test the relationship between the main indicators of investments in Intellectual Property Products and ICT equipment and the bank interest spread at national aggregate level. Our results demonstrate that investments in digitalization have a positive effect on bank profitability. Also the presence of Automatic Teller Machines (ATMs) still conduce to an enhance of income for banks and financial companies; conversely, the presence of physical branches has no effects. EFM Classification code: 510 Depository
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