Market Sidedness: Insights into Motives for Trade Initiation

A-Tier
Journal: Journal of Finance
Year: 2009
Volume: 64
Issue: 1
Pages: 375-423

Authors (2)

ASANI SARKAR (Federal Reserve Bank of New Yo...) ROBERT A. SCHWARTZ (not in RePEc)

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We infer motives for trade initiation from market sidedness. We define trading as more two‐sided (one‐sided) if the correlation between the number of buyer‐ and seller‐initiated trades increases (decreases), and assess changes in sidedness (relative to a control sample) around events that identify trade initiators. Consistent with asymmetric information, trading is more one‐sided before merger news. Consistent with belief heterogeneity, trading is more two‐sided before earnings and macro announcements with greater dispersion in analyst forecasts, and after news with larger announcement surprises. We examine the codeterminacy of sidedness, bid‐ask spread, volatility, number of trades, and order imbalance.

Technical Details

RePEc Handle
repec:bla:jfinan:v:64:y:2009:i:1:p:375-423
Journal Field
Finance
Author Count
2
Added to Database
2026-01-29