Background:Compared with the fixed-price mechanism,the bookbuilding mechanism has not changed the Chinese IPO high underpricing.How to develop scientific and reasonable IPO pricing,and reduce the high IPO underpricing...Background:Compared with the fixed-price mechanism,the bookbuilding mechanism has not changed the Chinese IPO high underpricing.How to develop scientific and reasonable IPO pricing,and reduce the high IPO underpricing has become a major challenge for China's securities market.Methods:In this paper,using behavioral finance theory and game theory,we build the Initial public offering(IPO)pricing and underpricing models with investors’heterogeneity based on different issuing mechanisms and provide a comparative analysis.Results:Firstly,our models show that IPO underpricing will not be eliminated by using either fixed-price or bookbuilding mechanisms,but when the investors’heterogeneity expectation is the same,lower IPO underpricing can be obtained by the issuing of bookbuilding compared with that of fixed price.Secondly,the IPO underpricing may be larger than that under fixed price if the heterogeneity of investors under bookbuilding is larger than that under fixed price.Thirdly,the numerical analysis results provide strong support for our model.Conclusions:These findings further explains the cause of the high IPO underpricing long-standing in China.展开更多
Along with the European Union,policymakers in Turkey passed a regulation that mandated all listed companies use the International Financial Reporting Standards(IFRS)starting from January 1,2005.Using a before-after es...Along with the European Union,policymakers in Turkey passed a regulation that mandated all listed companies use the International Financial Reporting Standards(IFRS)starting from January 1,2005.Using a before-after estimation design,this study examines the impact of this policy change and the role of institutional governance quality on the initial trading day and aftermarket trading performance of initial public offerings(IPO)in Turkey from 1998 to 2019.The results show that the IFRS mandate does not affect initial trading day returns but improves the aftermarket trading performance of IPO shares.This finding may imply that Turkey’s secondary market also suffers from information asymmetry and that IFRS-compliant reports help alleviate this problem.Furthermore,none of the six institutional governance quality measures tested loaded significantly against initial trading day or long-term returns.However,when examined together,two institutional measures with a negative value,voice and accountability,and political stability,offset the positive effect of the IFRS-compliant reporting on longterm IPO returns,providing support to the premise that institutional quality matters for realizing the economic benefits of the IFRS mandate.展开更多
Ever since the establishment of C hina's A- share market,whether in the bull or bear market,the IPO price almost surges on the first trading day,though the stock price fluctuates randomly. This phenomenon obviousl...Ever since the establishment of C hina's A- share market,whether in the bull or bear market,the IPO price almost surges on the first trading day,though the stock price fluctuates randomly. This phenomenon obviously contradicts Efficient M arket Hypothesis,indicating that IPO underpricing in C hina is severe. This paper investigates the causes for IPO underpricing and probes into the countermeasures for the phenomenon from several aspects such as government's regulation,capital markets,IPO bookbuilding mechanism and pricing mechanism,etc. The severe IPO underpricing is likely to cause massive speculation of newshares in the secondary market and increase volatility. Therefore,it is of great significance to make researches on the issue of high underpricing so as to ensure the sound development of the stock market.展开更多
In this paper, we study 169 IPO samples after Approval System is brought into effect. On the basis that we compare the degree of IPO underpricing in different underwriters and the underpricing condition between presti...In this paper, we study 169 IPO samples after Approval System is brought into effect. On the basis that we compare the degree of IPO underpricing in different underwriters and the underpricing condition between prestigious and non-prestigious underwriters, we go further to make regression analysis of the underwriter prestige and IPO underpricing which they underwrite. Finally we conclude that the offering price marketalization is still very low and the underwriter prestige does system is put into effect. not significantly impact on IPO underpricing after approval展开更多
This paper studies the IPO underpricing in the emerging stock market of China. The empirical results reveal that in China, the degree of IPO underpricing measured by first-day return is more than 100%, which is a prev...This paper studies the IPO underpricing in the emerging stock market of China. The empirical results reveal that in China, the degree of IPO underpricing measured by first-day return is more than 100%, which is a prevailing phenomenon for almost all IPO firms, regardless of the IPO time and the industry of the firm The degree of IPO underpricing in China is larger than the IPO initial returns documented in almost all the other countries. This considerable underpricing in China can hardly be explained by the information asymmetry theory and agency theory.展开更多
基金supports from National Natural Science Foundation of China(71361005)。
文摘Background:Compared with the fixed-price mechanism,the bookbuilding mechanism has not changed the Chinese IPO high underpricing.How to develop scientific and reasonable IPO pricing,and reduce the high IPO underpricing has become a major challenge for China's securities market.Methods:In this paper,using behavioral finance theory and game theory,we build the Initial public offering(IPO)pricing and underpricing models with investors’heterogeneity based on different issuing mechanisms and provide a comparative analysis.Results:Firstly,our models show that IPO underpricing will not be eliminated by using either fixed-price or bookbuilding mechanisms,but when the investors’heterogeneity expectation is the same,lower IPO underpricing can be obtained by the issuing of bookbuilding compared with that of fixed price.Secondly,the IPO underpricing may be larger than that under fixed price if the heterogeneity of investors under bookbuilding is larger than that under fixed price.Thirdly,the numerical analysis results provide strong support for our model.Conclusions:These findings further explains the cause of the high IPO underpricing long-standing in China.
文摘Along with the European Union,policymakers in Turkey passed a regulation that mandated all listed companies use the International Financial Reporting Standards(IFRS)starting from January 1,2005.Using a before-after estimation design,this study examines the impact of this policy change and the role of institutional governance quality on the initial trading day and aftermarket trading performance of initial public offerings(IPO)in Turkey from 1998 to 2019.The results show that the IFRS mandate does not affect initial trading day returns but improves the aftermarket trading performance of IPO shares.This finding may imply that Turkey’s secondary market also suffers from information asymmetry and that IFRS-compliant reports help alleviate this problem.Furthermore,none of the six institutional governance quality measures tested loaded significantly against initial trading day or long-term returns.However,when examined together,two institutional measures with a negative value,voice and accountability,and political stability,offset the positive effect of the IFRS-compliant reporting on longterm IPO returns,providing support to the premise that institutional quality matters for realizing the economic benefits of the IFRS mandate.
文摘Ever since the establishment of C hina's A- share market,whether in the bull or bear market,the IPO price almost surges on the first trading day,though the stock price fluctuates randomly. This phenomenon obviously contradicts Efficient M arket Hypothesis,indicating that IPO underpricing in C hina is severe. This paper investigates the causes for IPO underpricing and probes into the countermeasures for the phenomenon from several aspects such as government's regulation,capital markets,IPO bookbuilding mechanism and pricing mechanism,etc. The severe IPO underpricing is likely to cause massive speculation of newshares in the secondary market and increase volatility. Therefore,it is of great significance to make researches on the issue of high underpricing so as to ensure the sound development of the stock market.
文摘In this paper, we study 169 IPO samples after Approval System is brought into effect. On the basis that we compare the degree of IPO underpricing in different underwriters and the underpricing condition between prestigious and non-prestigious underwriters, we go further to make regression analysis of the underwriter prestige and IPO underpricing which they underwrite. Finally we conclude that the offering price marketalization is still very low and the underwriter prestige does system is put into effect. not significantly impact on IPO underpricing after approval
文摘This paper studies the IPO underpricing in the emerging stock market of China. The empirical results reveal that in China, the degree of IPO underpricing measured by first-day return is more than 100%, which is a prevailing phenomenon for almost all IPO firms, regardless of the IPO time and the industry of the firm The degree of IPO underpricing in China is larger than the IPO initial returns documented in almost all the other countries. This considerable underpricing in China can hardly be explained by the information asymmetry theory and agency theory.
