Emerging Markets Integration in Latin America (MILA) Stock market indicators: Chile, Colombia, and Peru


  • Edmundo R. Lizarzaburu Bolanos Universidad ESAN, Lima, Peru
  • Kurt Burneo Universidad del Pacífico, Lima, Peru
  • Hamilton Galindo c Universidad del Pacífico, Lima, Peru
  • Luis Berggrun Universidad Icesi, Cali, Colombia


MILA, Integration, Risk, Emerging markets


This study aims to determine the impact of the Latin American Integrated Market (MILA) start-up in the main indicators of the stock markets of the countries that conform it (Chile, Colombia, and Peru). At the end, several indicators were reviewed to measure the impact on profitability, risk, correlation, and trading volume between markets, using indicators such as: annual profitability, standard deviation, correlation coefficient, and trading volume. The sample period runs from November 2008 to August 2013; and involves the three stock markets associated with MILA: Bolsa de Comercio de Santiago (BCS), Bolsa de Valores de Colombia (BVC) y Bolsa de Valores de Lima (BVL). An additional evaluation for further research would consist of the calculation of relevant indicators to corroborate the validity of the effects found in this investigation corresponding to the integration of the stock exchanges of Lima, Santiago and Bogota, after the integration of the Mexican stock exchange that occurred in 2014.

Doi:  http://dx.doi.org/10.1016/j.jefas.2015.08.002


Download data is not yet available.


Acemoglu, D., & Zilibotti, F. (1997). Was Prometheus unbound by chance? Risk Diversification, and Growth. Journal of Political Economy, 105, 709–751.

Abergel, F.,Chakrabarti,B.,Chakraborti,A., &Mitra,M.(2011). Econophysics of orderdriven markets. Springer.

Agénor, P. R. (2003). Benefits and costs of international financial integration: Theory and facts. The World Economy, 26(8), 1089–1118.

AMV. (2012). Conozca los riesgos del Mercado de Valores. Cartilla N◦2. Retrieved on November 15, 2013. from:http://www.amvcolombia.org.co/ attachments/data/20120605120911.pdf.

Asness, Clifford S., Israelov, Roni, & Liew, John M. (2011). International Diversification Works (Eventually). Financial Analysts Journal, 67(3), 1–23.

Babecky, J., Komarek, L. and Komarkova, Z. (2012). Integration of Chinese and Russian Stock Market with world markets: National sectoral perspectives. Bank of Finland, BOFIT. Institute of Economies in Transition, (8).

Bartram, S. M., & Dufey, G. (2001). International portfolio investment: Theory, evidence, and institutionalframework. Financial Markets, Institutions & Instruments,10(3), 85–155.

Bekaert, G., & Harvey, C. R. (1995). Time-varying world market integration. Journal of Finance, 50, 403–444.

Bekaert, G., & Harvey, C. R.(1998). Capital flows and the behavior of emerging market equity returns (No. w6669). National bureau of economic research.

Bekaert, G., & Harvey, C. R.(2000). Foreign speculators and emerging equity markets. Journal of Finance, 55, 565–614.

Bekaert, G., Hodrick, R. J., & Zhang, X. (2009). International stock return comovements. The Journal of Finance, 64, 2591–2626, 6.

Brailsford, T. (1994). The empirical relationship between trading volume, returns and volatility. Research paper, 94–101.

BVC. (2013). Metodología para el cálculo del índice COLCAP. Retrieved from: http://www.bvc.com.co/pps/tibco/portalbvc/Home/Mercados/descripciongeneral/

indicesbursatiles?com.tibco.ps.pagesvc.action=updateRenderState&rp.current DocumentID=13c20e3d 13d5f9d729a 7fcc0a0a600b&rp.revisionNumber=1& rp.attachmentPropertyName=Attachment&com.tibco.ps.pagesvc.targetPage=

f9a1c33 132040fa022 -78750a0a600b&com.tibco.ps.pagesvc.mode=resource &rp.redirectPage=1f9a1c33 132040fa022 -787e0a0a600b on August 8, 2015.

BVL. (2013). Preguntas frecuentes MILA. Retrieved from: http://www.bvl.com.pe/ mila/preguntas frecuentes.pdf on September 15, 2013.

Carrieri, Francesca, Errunza, Vihang, & Hogan, Ked. (2007). Characterizing world market integration through time. Journal of Financial and Quantitative Analysis, 42(04), 915–940.

Chisholm, A. M. (2003). An introduction to capital markets: Products, strategies, participants. John Wiley & Sons.

CIA. (2013). The World Factbook. Retrieved from: https://www.cia.gov/library/ publications/the-world-factbook/on September 15, 2013.

DCV (2011). Guía de Mercado Integrado MILA. Versión 3.

Fama, E. (1965). The behavior of stock market prices. Journal of Business, 38, 34–105.

Fama, E. (1991). Efficient capital markets: II. Journal of Finance, 46, 1575–1617.

Fenn, D., Porter, M., Williams, S., McDonald, W., Johnson, N., & Jones, N. (2011). Temporal evolution of financial market correlations. Physical Review, E 84, 026109.

García-Herrero, A., & Wooldridge, P. (2007). Global and regional financial integration: Progress in emerging market. BIS Quarterly Review, 57–70.

Greenwood, R. and Scharfstein, D. (2012). The growth of modern finance. Available in SSRN 2162179.

Gurnain, P. (2007). Financial integration in emerging market economies. MPRA Paper 5278, University Library of Munich, Germany (available at: http://mpra.ub.unimuenchen. de/5278/1/MPRA paper 5278.pdf).

Hogue, J. (2011). MILA Integration report: Detailed analysis on exchange integration of Chile. Colombia and Peru: Efficient Alpha.

Levine, R. (2002). Bank-based or market-based financial systems: Which is better? Journal of Financial Intermediation, 11(4), 398–428.

Lo, A. W., & Craig MacKinlay, A. (1990). An econometric analysis of nonsynchronous trading. Journal of Econometrics, 45, 181–211.

Longin, F., & Solnik, B. (1995). Is the correlation in international equity returns constant: 1960-1990? Journal of International Money and Finance, 14(1), 3–26.

Madura, J. (2010). Mercados e instituciones financieras/Financial markets and institutions. Cengage Learning Editores.

Makridakis, S. G., & Wheelwright, S. C. (1974). An analysis of the interrelationships among the major world stock exchanges. Journal of Business Finance & Accounting, 1(2), 195–215.

Mellado, C., & García, S. (2014). . The effects of the Latin American Integrated Market (MILA) on the foreign Exchange of Colombia (4) Peru and Chile: American Journalof Economics., 2A.

Melo, L., & Becerra, O. (2005). Medidas de riesgo, características y técnicas de medición. Una aplicación del VaR y el ES a la tasa Interbancaria de Colombia. Colombia: Banco de la República.

MILA. (2013). http://www.mercadomila.com/componentes/imagenes/mila news no 21.pdf.

Molina Castilla, N., Pabón Gutiérrez, J. D., Patino, ˜ E. and Alonso, M. (2012). Descripción del impacto del mercado integrado latinoamericano MILA para las acciones de dos emisores del sector de hidrocarburos en Colombia. Chía–Cundinamarca: Universidad de la Sabana–Especialización en Finanzas y Mercado de Capitales.

Obstfeld, M. (1994). Risk-taking, global diversification, and growth. American Economic Review, 84, 1310–1329.

Panchenko, V., &Wu, E.(2009). Time-varying marketintegration and stock and bond return concordance in emerging markets. Journal of Banking & Finance, 33(6), 1014–1021.

Parejo, J. A., García, A. C., & Gámir, J. A. P. (2004). Manual del sistema financiero espanol. ˜ Ariel, 12.

Perú 21. (2013). México entraría al MILA a mediados de 2013. Retrieved on November 15, 2013, from: http://peru21.pe/economia/mexico-entraria-almila-mediados-2014-2152844.

Richards, R. (2013). Lecture notes on return calculation. Computational Finance and Financial Econometrics. University of Washington. Retrieved from: http://faculty.washington.edu/ezivot/econ424/returnCalculations.pdf.

Romero-Álvarez, Y. P., Ramírez-Atehortúa, F. H., & Guzmán-Aguilar, D. S. (2013).

Mercado Integrado Latinoamericano (MILA): análisis de correlación y diversificación de los portafolios de acciones de los tres países miembros en el período 2007-2012. Cuadernos de Contabilidad, 14(34).

Schwert, G. W. (1990). Stock market volatility. Financial Analysts Journal, 23–34.

Sinha, S., Chatterjee, A., Chakraborti, A., & Chakrabarti, B. (2010). Econophysics: An introduction. Wiley-VCH.

Slee, R. T. (2011). Private capital markets: Valuation, capitalization, and transfer of private business interests. John Wiley & Sons.

Sornette, D. (2004). Why stock markets crash: Critical events in complex financial systems. Princeton University Press.

Stiglitz, J. E. (2000). Capital market liberalization, economic growth, and instability. World development, 28(6), 1075–1086.

S&P Dow Jones Indices (2013). Benchmarking MILA. McGraw Hill Financial. Retrieved from: http://www.spindices.com/documents/research/researchmila-40-spanish.pdf on June 19, 2014

S&P Dow Jones (2013). S&P Dow Jones Indices: S&P MILA 40 Methodology. Retrieved

from: http://us.spindices.com/documents/methodologies/methodology-spmila-40.pdf?force download=true on July 19, 2014.

Takayasu, H.(2006). Practical fruits of econophysics: Proceedings ofthe Third Nikkei Econophysics Symposium. Springer.

Thapa, Chandra, & Poshakwale, Sunil S. (2010). International equity portfolio allocations and transaction costs. Journal of Banking & Finance, 34(11), 2627–2638.

Voit, J. (2005). The statistical mechanics of financial markets. Springer.

Wong, A. S. K., & Vlaar, P. J. (2003). Modelling time-varying correlations of financial markets. The Nederlandsche Bank NV Research Memorandum, 739, 0319




How to Cite

Lizarzaburu Bolanos, E. R. ., Burneo, . K. ., Galindo, H. ., & Berggrun, L. (2015). Emerging Markets Integration in Latin America (MILA) Stock market indicators: Chile, Colombia, and Peru. Journal of Economics, Finance and Administrative Science, 20(39), 74–83. Retrieved from https://revistas.esan.edu.pe/index.php/jefas/article/view/154