Key Charts - Size and Structure

Latin America: Focusing on the Capital Market Infrastructure Can Widen the Flow of Investments
  • Due to excessive restrictions, capital markets across Latin America remain underdeveloped in comparison to emerging markets in Asia.
  • Short selling is infeasible as a result of rules that allow short selling of only the most liquid securities and prevent the non-delivery of stocks at settlement. Domestic derivative markets are underdeveloped, and securities lending is restricted, sometimes leading to the creation of synthetic derivatives.
  • If the countries can focus on fixing these weaknesses, the plausible gains would include improved exchange infrastructure and lower transaction costs, which could widen the flow of funding and investment.

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Source: FTSE Quality of Markets Criteria (Americas, March 2014)

Latin America: Focusing on the Capital Market Infrastructure Can Widen the Flow of Investments

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