Citation

Discussion Paper Details

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Title: The Use of Flow Analysis in Foreign Exchange: Explanatory Analysis

Author(s): Thomas Gehrig and Lukas Menkhoff

Publication Date: February 2002

Keyword(s): flow trading, foreign exchange markets and market microstructure

Programme Area(s): Financial Economics

Abstract: This Paper provides questionnaire evidence on the role of flow analysis for professional traders and fund managers. This evidence suggests that besides fundamental information and technical analysis, the analysis of flows provides an independent third type of information for professionals. The proposition that flows can be used to learn about fundamentals is not consistent with the data. Instead, evidence indicates that flows more likely provide insight into semi-fundamental private information, suggesting support for the efficient market hypothesis only in a weak form.

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Bibliographic Reference

Gehrig, T and Menkhoff, L. 2002. 'The Use of Flow Analysis in Foreign Exchange: Explanatory Analysis'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=3221