IPO activity and information in secondary market prices
| Autor: | Silvia Rossetto |
|---|---|
| Přispěvatelé: | Finance, Centre de Recherche en Management (CRM), Université Toulouse 1 Capitole (UT1), Université Fédérale Toulouse Midi-Pyrénées-Université Fédérale Toulouse Midi-Pyrénées-Institut d'Administration des Entreprises - Toulouse (IAE)-Centre National de la Recherche Scientifique (CNRS)-Université Toulouse 1 Capitole (UT1), Université Fédérale Toulouse Midi-Pyrénées-Université Fédérale Toulouse Midi-Pyrénées-Institut d'Administration des Entreprises - Toulouse (IAE)-Centre National de la Recherche Scientifique (CNRS) |
| Jazyk: | angličtina |
| Rok vydání: | 2013 |
| Předmět: |
050208 finance
Quantitative Finance Financial economics 05 social sciences Financial market Enterprise value Finance/Investment/Banking Secondary market Investment (macroeconomics) Information asymmetry 0502 economics and business 8. Economic growth Economics [SHS.GESTION]Humanities and Social Sciences/Business administration Profitability index Macroeconomics/Monetary Economics Listing (finance) General Economics Econometrics and Finance Initial public offering Finance 050205 econometrics |
| Zdroj: | Annals of Finance Annals of Finance, Springer Verlag, 2013, 9 (4), pp.667-687. ⟨10.1007/s10436-012-0213-2⟩ |
| ISSN: | 1614-2446 1614-2454 |
| Popis: | International audience; This paper explores the link between IPO underpricing and financial markets. In my model the IPO is a mean for a capital constrained initial investor to exit and thereby to raise funds for a new investment opportunity. This investor is privately informed vis-a-vis outside investors about the profitability of the new opportunity and the quality of the firm to be offered in the IPO. He can then use the offer price and the fraction of shares sold as signals of his private information. The model shows that underpricing is not only linked to firm's characteristics, i.e. firm value, but to elements external to the firm, i.e. new investment profitability and financial markets characteristics. In particular higher market efficiency reduces the cost of listing. This results in lower underpricing and the listing of more valuable firm. Similarly, a higher lower bound of the new investment's profitability reduces the information asymmetry and hence reduces underpricing and widens the range of firms listed. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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