Summary of On the Fortunes of Stock Exchanges and Their Reversals

Evidence from Foreign Listings


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On the Fortunes of Stock Exchanges and Their Reversals summary
Companies follow the money – and, surprisingly, stricter regulation.


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As capital flows around the globe, it has become simpler for investors to buy securities in almost any of the world’s stock exchanges. This raises the question of why companies continue to seek secondary listings outside their home countries. Finance professors Nuno Fernandes and Mariassunta Giannetti undertook a broad study that offers some new insights into why and where firms cross-list their shares, and what roles governance rules and investor protection play in those choices. Their paper is rigorously academic in tone, and getAbstract recommends it to executives, regulators and policy makers with an advanced technical interest in the topic.

In this summary, you will learn

  • What makes an exchange attractive to foreign issuers
  • Why US and UK exchanges are the dominant markets for overseas firms
  • What role regulations play in cross-listings


Firms seek to tap global capital flows by offering, or cross-listing, their shares on foreign stock exchanges. In total, some 10% of companies maintain cross-listings outside their home markets. Prior research into these secondary share listings has focused on foreign firms seeking US listings, but ...
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About the Author

Nuno Fernandes is a professor of finance at the International Institute for Management Development in Lausanne, Switzerland. Mariassunta Giannetti is a professor of finance at the Stockholm School of Economics.

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