1) If you believe (like I do) the next decade will be a fairly inflationary one, owning stock exchanges traditionally are a good way to protect oneself. (By way of example, Horizon Kinetics' Inflation Beneficiaries ETF -- $INFL -- holds a number of stock exchanges in its portfolio: $ICE, the TMX Group, and the Deutsche Boerse).
2) Is there an argument to be made that the existence of BIVA is beneficial to BMV? Both exchanges list the same stocks. So theoretically, shouldn't arbitrageurs be driving up volume on both exchanges, as they arbitrage between the two?
I agree on these faring reasonably well in an inflationary environment.
On the second point, I'd assume lower listing fees and related revenues would more than offset any benefits from more liquidity/arb activity but I haven't studied it to be sure.
Great article, Ian.
A couple small additional thoughts:
1) If you believe (like I do) the next decade will be a fairly inflationary one, owning stock exchanges traditionally are a good way to protect oneself. (By way of example, Horizon Kinetics' Inflation Beneficiaries ETF -- $INFL -- holds a number of stock exchanges in its portfolio: $ICE, the TMX Group, and the Deutsche Boerse).
2) Is there an argument to be made that the existence of BIVA is beneficial to BMV? Both exchanges list the same stocks. So theoretically, shouldn't arbitrageurs be driving up volume on both exchanges, as they arbitrage between the two?
I agree on these faring reasonably well in an inflationary environment.
On the second point, I'd assume lower listing fees and related revenues would more than offset any benefits from more liquidity/arb activity but I haven't studied it to be sure.
I would be more focused on market share loss than increasing volume do to arbing the exchanges
There was a large jump in BMV's transaction volume after BIVA came onto the scene in 2018, so not sure I agree with your focus.
Great writeup! Do the dividends flow properly to the unsponsored OTC listing?
It appears so. For the BOXMF listing, I'm seeing past dividend payments of:
.1004 in 2021
.1064 in 2022
.1306 in 2023
and a scheduled .1296 for 2024
That seems to be in-line with what an owner of the Mexican class shares would have received.
Have you looked at LAUR
Several people have asked me about it recently, so I will add LAUR to the to-research list. Thanks for asking!
Yw