Relations between Market Liquidity and New Listings: Istanbul Stock Exchange (BIST) Evidence
Alp Polat, Dr. Guven Sevil

Abstract
The study aims to discover the interactions between new listings and market liquidity in Turkey. While market liquidity can help the process of an initial public offering, new listings can induce the liquidity. The proof of these two way relationship is beneficial for economic and investment decisions. The fact that empirical researches are very limited in the related literature suggests the importance of the study. The Vector Autoregressive methodology is chosen due to its endogeneity bias and other advantages. The data collected from Istanbul Stock Exchange (BIST) is analysed for the period 2000-2012. Granger causality tests and impulse response functions are utilized. Market liquidity conditions are found useless in new issues of financial markets. It indicates that individuals have other interests than following the ease of trading. The analysis also detects that listings have an effect upon liquidity.

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