What are the major drivers behind listing volume fluctuations in Norway and Sweden?

Abstract

This thesis investigates potential drivers behind fluctuations in listing volume in Norway and Sweden between 2000 and 2016. The paper replicates findings in previous literature by investigating whether aggregate capital demands, information asymmetry and investor sentiment can explain fluctuations in listing volume. Based on a review of the Norwegian - and Swedish equity markets, the introduction of a secondary stock exchange is included as a potential explanation. Empirical tests include aggregate time-series regressions, using proxies for the above-mentioned factors. All hypotheses are tested both collectively and individually. Regressions are run separately for each country. This enables us to compare results from each country, thereby strengthening the reliability of the results. Results indicate that the level of investor optimism is an important determinant of listing volume in Norway and Sweden, in both statistical – and economic terms. The combined results from both markets, does not offer adequate support for the remaining hypotheses.