PT - JOURNAL ARTICLE AU - Nikolaj Hesselholt Munck TI - When Transactions Went High-Tech AID - 10.3905/jot.2006.654305 DP - 2006 Sep 30 TA - The Journal of Trading PG - 90--103 VI - 1 IP - 4 4099 - https://pm-research.com/content/1/4/90.short 4100 - https://pm-research.com/content/1/4/90.full AB - This study aims at comparing the costs of trading for an institutional investor at the larger stock exchanges of Europe and the Northern countries. Based on figures for the last 8 years we find that, even though the cost levels have varied significantly both over time as well as among exchanges, the cost levels among exchanges have been clustering the last couple of years. Further analyses of the cost figures for 2004 indicate that the direct costs of trading are approximately identical across the major European markets. Derived from both an empirical and a statistical analysis we find that the direct cost levels have been declining significantly the last years, with up to 35 percent. Furthermore, we identify the system turnover as a statistical significant explanatory variable for both the indirect and the direct costs, hence for the total cost. This relationship has not been pointed out previously. According to our results, one would expect both the implicit and explicit costs to depreciate as the system activity appreciates. This link serves as weak evidence of the fact that coalescing trading systems might imply lower future trading costsTOPICS: Exchanges/markets/clearinghouses, big data/machine learning