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Information asymmetry of corporate Korean world: (Bid-ask spread)

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  • Information asymmetry of corporate Korean world: (Bid-ask spread)
  • Alexis, Ndayishimiye; Toh, Tasoh Martin
  • Daegu University


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Title Information asymmetry of corporate Korean world: (Bid-ask spread)
Similar Titles
Material Type Reports
Author(English)

Alexis, Ndayishimiye; Toh, Tasoh Martin

Publisher

[Gyeongsan, South Korea]:Daegu University

Date 2016-05
Pages 11
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Economic System
Economy < Direct Investment
Holding SSRN

Abstract

This paper followed a similar Amihud and Mendelson (1986) methodology to empirically examine the relationship between expected stock's return and the bid-ask spread in the Korean corporate market. We could noticed a significant and positive bid-ask spread. The result recognized information asymmetry or market frictions. After confirming market efficiency in previous studies, and information asymmetry in this study, we concluded that the market are weak and semi-strong but we doubt if the market are strongly efficient. We recommended that investors should limit their effort to technical and fundamental analysis. However digging some private information could be of advantage to active strategist. This can only be confirm through a comparative Korean stock's earning analysis of both domestic and foreign investors.