1 NBER -A simple Model of IPO underpricing
نویسنده
چکیده
We propose a new theory of IPO underpricing where the asymmetry of the underwriter’s incentives and presence of valuation uncertainty makes underpricing unavoidable. We show how the size of underpricing is defined by valuation uncertainty of the stock (“volatility”) and by the fee level. We quantify the relationship between level of underpricing and level of price volatility. We also show that the “winner’s curse” is a by-product of the ex-ante valuation uncertainty .
منابع مشابه
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