A multi-layered network of the (Colombian) sovereign securities market
Renneboog,Luc León,C. Pérez,Jhonatan
Renneboog,Luc
León,C.
Pérez,Jhonatan
Abstract
We study the network of Colombian sovereign securities settlements. With data from the settlement market infrastructure we study financial institutions’ transactions from three different trading and registering individual networks that we combine into a multi-layer network. Examining this network of networks enables us to confirm that (i) studying isolated single-layer trading and registering networks yields a misleading perspective on the relations between and risks induced by participating financial institutions; (ii) a multi-layer approach produces a connective structure consistent with most real-world networks (e.g. sparse, inhomogeneous, and clustered); and (iii) the multi-layer network is a multiplex that preserves the main connective features of its constituent layers due to positively correlated multiplexity. The results highlight the importance of mapping and understanding how financial institutions relate to each other across multiple financial environments, and the value of financial market infrastructures as sources of data that may help to overcome the main obstacles for working on multi-layer financial networks.
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Date
2015
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IGI Global
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Citation
Renneboog, L, León, C & Pérez, J 2015, A multi-layered network of the (Colombian) sovereign securities market. in B Alexandrova-Kabadjova, M Diehl, R Heuver & S Martinez-Jaramillo (eds), Analyzing the Economics of Financial Market Infrastructures : Advances in Finance, Accounting and Economics. AFAE Book Series, IGI Global, Hershey, pp. 124-149. https://doi.org/10.4018/978-1-4666-8745-5.ch007