Market Sentiment, IPO Underpricing, and Valuation
نویسندگان
چکیده
منابع مشابه
Market Sentiment, IPO Underpricing, and Valuation
We examine IPO underpricing, valuation, and wealth allocation in relation to investor sentiment, information asymmetry, and underwriter reputation. We find that underpricing is significantly higher for overvalued IPOs than for undervalued IPOs, and is positively correlated to investor sentiment. Information asymmetry is also positively correlated to the magnitude of underpricing but only for un...
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This paper examines how the difference in institutional environments constitutes differential IPO underpricing across countries. Using the Heritage Foundation’s Index of Economic Freedom (IEF) as a proxy for the heterogeneous institutional environment, and a sample of 3728 IPOs from 22 countries and regions over the period 1993–2014, we find that countries with higher economic freedom have sign...
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This paper explains why the evidence on the relation between litigation risk and initial public offering (IPO) underpricing is mixed. Two reasons are behind the nonstationary relation. First, the increasing usage of Directors and Officers’ liability insurance arguably reduces the need to use underpricing to insure against litigation liability to a limited extent. Second, class action lawsuits o...
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The central question surrounding the IPO underpricing puzzle is why issuers are willing to sell their shares at a price that is less than what the market is willing to pay. This paper shows that a major reason why managers are willing to underprice shares at IPO is that they use options and stock grants to protect themselves from the dilution to their existing shares. Underpricing can have a la...
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ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2008
ISSN: 1556-5068
DOI: 10.2139/ssrn.1102563