13. The Future of Financial Markets
The transformation to global electronic exchanges is still a work in progress. This chapter explores several trends and their impact on financial markets. Globalization could lead to monopolies, but it is now easier to assemble new competitive exchanges. Automated trading will make trading even faster, forcing exchanges to continue to innovate technologically. And other components of the trade cycle are still in the process of adapting to these changes.
The last two decades have been a busy time for financial markets around the world. Technological advances have allowed exchanges to replace the century-old floor-trading model with the electronic trading model. Markets today are far more complex, ...