Blockholders, board structure and liquidity: Evidence from Tunis stock exchange

Abstract

This paper investigates the effect of blockholders and board structure into stock liquidity in Tunisian market. We use five measures of liquidity in order to detect the multidimensionality of liquidity: immediacy cost, price impact, trading frequency, trading speed and total transaction cost. Results show that blockholders, insiders or outsiders, reduce trading speed, while ownership concentration and board characteristic effect on liquidity depend on liquidity dimension considered. Insider ownership concentration enhances price impact. Outsider ownership concentration induces a high trading activity. A large board size improve firm transparency reduces transactions cots. A high proportion of outsider directors increase trading speed.