Influence of Structural and Organizational Reforms on Trading Efficiency on the Moscow Exchange

Importance of this study is related to the fact that on 5 February, 2009 The Russian Government accepted a project «Moscow – International financial center» which was aimed to improve business climate, to make financial market in Russia a significant and viable part of a global system, enhance its infrastructure and to boost attractiveness for foreign issuers and investors. For the achievement of International financial center status, attraction of foreign investors and increase in competitiveness organizational and structural reforms were implemented on the Moscow Stock Exchange. The purpose of the study is to find out how the implementation of organizational and structural reforms on the Moscow Stock Exchange after the merger of RTS and MICEX impacted trading efficiency and whether market-players were sensitive to these changes. Approach consists of 3 differently focused goodness-of-fit test conducted on samples of liquidity parameters of issuers included in the Blue Chip and MICEX indices before and after reforms implementation on the Moscow Stock Exchange. Results showed that market players were sensitive to the implementation of organizational and structural reforms on the Moscow Stock Exchange while trading efficiency improved only partially. Conclusions When examining trading efficiency through liquidity it should be noticed that it is a difficult concept consisting of metrics related to different dimensions which show only one property of this measure that should be considered in complex.