Disparities in capital markets of the EU and the US
Disparities in capital markets of the EU and the US

Author(s): Erik Suchý, Leos Safar
Subject(s): Economic policy, Comparative politics, Economic development, EU-Accession / EU-DEvelopment, Financial Markets
Published by: Masarykova univerzita nakladatelství
Keywords: Capital Market Union; stock markets; capital market; stock exchange;
Summary/Abstract: The aim of the paper is to give strong preview of the EU and US position in global trade by comparing capital/stock markets in the EU and US. For this purpose we used trading volumes on several instruments. After presenting dependence between trading volumes and market capitalization for both sides of pacific, we gradually show major differences in overall trades/volumes and specific areas such as interest rates trading, ETFs, stock options, investment funds etc., using data collected from 70 biggest exchanges, covering more than 90% of total stock market capitalization, In line with expectations, our findings prove that US market is definitely significantly bigger and more dynamic than EU market with almost doubled market capitalization and more than tripled number of trades. Findings in this paper show that Capital Markets Union concept brought by the European Commission could lead to increase in those numbers subsequently make EU market more flexible and dynamic. Improving redistribution and transmission of assets and capital in the EU market supported by CMU could lead to better economic growth and better overall performance.

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