Download or read book The Phenomenon of IPO Underpricing in the European and U S Stock Markets written by Oliver Reiche and published by Anchor Academic Publishing (aap_verlag). This book was released on 2014-06-23 with total page 105 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Initial Public Offering (IPO) marks one of the most important events of a company. Basically, the aim is to generate maximum proceeds by selling the company’s shares to investors. However, the shares that are sold seem to be underpriced as the price significantly soars on the first trading day. Since the very first detection of this phenomenon in the United States in 1969, several subsequent studies have documented the existence of worldwide IPO underpricing. This study focuses on IPO Underpricing in the European and United States Stock Markets by outlining and discussing the following essential issues: What is underpricing in the context of the IPO? Which motivations are there and how do they impact? Is there IPO underpricing in the markets of Europe and the United States of America?
Download or read book The Specific Underpricing of IPOs in U S Stock Markets written by Claus Birkenbeul and published by GRIN Verlag. This book was released on 2010-09-30 with total page 87 pages. Available in PDF, EPUB and Kindle. Book excerpt: Master's Thesis from the year 2010 in the subject Business economics - Banking, Stock Exchanges, Insurance, Accounting, grade: 1,3, Munich Business School University of Applied Sciences, language: English, abstract: The economical development is improving and world trade volumes are expected to recover. The recorvery process is developing constantly but slowly: Share prices have rebounded within 2009, worldwide trade volumes have recovered slightly and are expected to catch up with values from the end of 2008 during the next year (cf. OECD 2009). The world is recovering from one of the most severe economic downturns since The Great Depression. Comparing GDP volumes from the previous period at the same time, OECD countries lost up to 2%. As a logical consequence the U.S. IPO market has been affected by the economic meltdown as well. "IPO activity tends to cluster in certain time periods, thus it appears in waves, so-called hot IPO markets" (Hamer 2007, 9). From 2007 to 2008 th e number of IPOs decreased. The U.S. market broke down by more than 85% in one year. In 2007 there were 160 IPOs whereas in 2008 21 securities went public fort the first time (cf. Ritter 2010, 2). After the slowest year for IPOs since the 1970s, the market began to show signs of life again in 2009. The number of offerings increased by 21% although the offering value decreased by almost 15% (cf. PWC 2010). [...]
Download or read book The Specific Underpricing of Ipos in U S Stock Markets written by Claus Birkenbeul and published by GRIN Verlag. This book was released on 2010-10 with total page 89 pages. Available in PDF, EPUB and Kindle. Book excerpt: Master's Thesis from the year 2010 in the subject Business economics - Banking, Stock Exchanges, Insurance, Accounting, grade: 1,3, Munich Business School University of Applied Sciences, language: English, abstract: The economical development is improving and world trade volumes are expected to recover. The recorvery process is developing constantly but slowly: Share prices have rebounded within 2009, worldwide trade volumes have recovered slightly and are expected to catch up with values from the end of 2008 during the next year (cf. OECD 2009). The world is recovering from one of the most severe economic downturns since The Great Depression. Comparing GDP volumes from the previous period at the same time, OECD countries lost up to 2%. As a logical consequence the U.S. IPO market has been affected by the economic meltdown as well. "IPO activity tends to cluster in certain time periods, thus it appears in waves, so-called hot IPO markets" (Hamer 2007, 9). From 2007 to 2008 th e number of IPOs decreased. The U.S. market broke down by more than 85% in one year. In 2007 there were 160 IPOs whereas in 2008 21 securities went public fort the first time (cf. Ritter 2010, 2). After the slowest year for IPOs since the 1970s, the market began to show signs of life again in 2009. The number of offerings increased by 21% although the offering value decreased by almost 15% (cf. PWC 2010). [...]
Download or read book The Phenomenon of IPO Underpricing in the European and U S Stock Markets written by Oliver Reiche and published by diplom.de. This book was released on 2014-06-01 with total page 102 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Initial Public Offering (IPO) marks one of the most important events of a company. Basically, the aim is to generate maximum proceeds by selling the company’s shares to investors. However, the shares that are sold seem to be underpriced as the price significantly soars on the first trading day. Since the very first detection of this phenomenon in the United States in 1969, several subsequent studies have documented the existence of worldwide IPO underpricing. This study focuses on IPO Underpricing in the European and United States Stock Markets by outlining and discussing the following essential issues: What is underpricing in the context of the IPO? Which motivations are there and how do they impact? Is there IPO underpricing in the markets of Europe and the United States of America?
Download or read book Empirical Evidence on IPO Underpricing written by Marius Hamer and published by GRIN Verlag. This book was released on 2008 with total page 73 pages. Available in PDF, EPUB and Kindle. Book excerpt: Diploma Thesis from the year 2007 in the subject Business economics - Investment and Finance, grade: 1,3, European Business School - International University Schlo Reichartshausen Oestrich-Winkel, 80 entries in the bibliography, language: English, abstract: This paper aims at establishing a link between the average level of initial return of IPO shares, existing underpricing explanations and the dot-com bubble. In years prior to the boom of the new economy, underpricing was explained by various theories, which have extensively been developed since decades. However, in the years 1998 to 2001 IPOs were overly underpriced, leading to assumptions about behavioural aspects and investor irrationality. Analysing a comprehensive dataset of 371 IPOs on the Frankfurter B rse between 1997 and 2007, this paper aims at providing evidence that the observed lower levels of initial returns in recent years can indeed be aligned with existing theories on the basis of rational behaviour of market participants. Firstly, the IPO process and its major participants will be presented followed by a review of relevant studies on the IPO phenomenon. In the next step, established underpricing theories are recapitulated. A descriptive analysis of the data sample points out the particularities concerning the company and transaction characteristics of the sample firms. In a last step, a regression analysis relates various proxies for information asymmetry to established underpricing theories. It gives reason to believe that the irrationality at the turn of the century has vanished and that underpricing can again be explained by established theories.
Download or read book A Survey of the European IPO Market written by and published by CEPS. This book was released on 2006 with total page 94 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Pricing Initial Public Offerings on New European Stock Markets written by Giancarlo Giudici and published by . This book was released on 2002 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: In 2000 more companies listed in Europe than in the US. This is mainly due to the success of quot;newquot; stock markets designed for high-growth companies. In this paper we analyse a sample of 482 Initial Public Offerings (IPOs), listed on five quot;newquot; European stock markets up to March 2001. We investigate the determinants of their first-day returns. We find a mean first-day return (underpricing) equal to +38.09%. Market returns, the IPO firm's risk and price revisions in the premarket are positively related to first-day returns, whereas IPO deal flow shows is inversely related to underpricing. We also show that the Internet euphoria impacts first-day returns.
Download or read book The Oxford Handbook of IPOs written by Douglas Cumming and published by Oxford University Press. This book was released on 2018-11-15 with total page 841 pages. Available in PDF, EPUB and Kindle. Book excerpt: Initial public offerings (IPOs), or new listings of companies on stock exchanges, are among the most important form of finance and generate considerable attention and excitement. They are used to raise capital or to monetize investments by the early generation of venture capital and other private investors. They are increasingly international in scope and reach, especially with non-American firms offering on American stock exchanges. This handbook provides a comprehensive overview of why companies list on stock exchanges, how IPOs are regulated, initially valued, and their performance in the short and long run. The first part examines the economics of IPOs, and offers statistics and regulatory insights from the United States and other countries around the world. The volume then covers mergers versus IPOs, as well as reverse mergers and special purpose acquisition companies. Part III analyzes institutional ties in IPOs, including analysts, investment banks, auditors, and venture capitalists. The fourth section provides international perspectives on IPOs from a number of countries around the world. Part V discusses alternatives to IPOs, including private marketplaces, and crowdfunding. Reflecting the range of disciplines that analyze IPOs, the contributors come from the fields of finance, international business and management, economics, and law. The chapters cover the latest information on a range of fundamental questions that are of interest to academics, practitioners, and policymakers alike.
Download or read book IPO Underpricing in Germany Empirical Analysis of Influencing Variables written by Justyna Dietrich and published by diplom.de. This book was released on 2011-10-27 with total page 76 pages. Available in PDF, EPUB and Kindle. Book excerpt: Inhaltsangabe:Introduction: Detected on the US market centuries ago, underpricing is the phenomenon of abnormal first-day returns from initial public offerings (IPOs). Without doubt, any US investor would agree, that one day-returns of 11.4% on average are exceptional and a worthwhile investment. Since then many studies have proven that it is a persistent phenomenon and also occurs on markets all over the world. The most puzzling question for scientists is why companies are leaving this money on the table and don t set an offering price that reflects the market demand at the offering date. Within that, researchers have also been trying to determine the factors that influence the severity of underpricing. Many different explanations with regard to the existence of underpricing have been derived thus far, with all claiming to be valid even if not exclusively. But despite this effort, research so far has not been able to create common sense. Some even argue that underpricing may not exist at all since most IPOs underperform severely in the long-run which leads some people to the conclusion that IPOs are in fact overpriced. The main focus of this paper is whether and how the findings of past research, primarily conducted for the US market, apply to the German IPO market. As a result, both investors and issuers shall receive practical implications for their decision-making within the IPO process. So far, profound underpricing research for the German market has been rather scarce. Most of the available literature concentrates either on dates before 1997 when most offering prices have been determined by using the fixed price mechanism whereas the most recent studies focus on the German stock exchange segment Neuer Markt exclusively. In contrast, this paper aims to give a more recent analysis of underpricing on the German market without distinguishing between different market segments. Additionally, a broad over-view and understanding of IPO underpricing, taking the long-run performance of IPOs into account, will be included. As a result, this paper is structured as follows: The second section consists of a description of some of the important theoretical aspects that have influence on the price setting of an IPO. It will concentrate on business valuation as it is the basis for setting the price of an IPO. Furthermore, the most common price setting mechanisms shall be explained. Additionally, the special role of the lead underwriter in the IPO [...]
Download or read book Going Public written by Tim Jenkinson and published by Oxford University Press, USA. This book was released on 2001 with total page 264 pages. Available in PDF, EPUB and Kindle. Book excerpt: Going Public investigates why companies routinely underprice themselves as they try to list themselves on the stock exchange. They subsequently underperform over the long-term and, in Going Public, the authors explore these 2 phenomena in plain English.
Download or read book The Oxford Handbook of Entrepreneurial Finance written by Douglas Cumming and published by OUP USA. This book was released on 2012-03-22 with total page 937 pages. Available in PDF, EPUB and Kindle. Book excerpt: Provides a comprehensive picture of issues dealing with different sources of entrepreneurial finance and different issues with financing entrepreneurs. The Handbook comprises contributions from 48 authors based in 12 different countries.
Download or read book Initial Public Offerings Findings and Theories written by Seth Anderson and published by Springer Science & Business Media. This book was released on 2012-12-06 with total page 126 pages. Available in PDF, EPUB and Kindle. Book excerpt: Initial public offerings (IPOs) play a crucial role in allocating resources in market economies. Because of the enormous importance of IPOs, an understanding of how IPOs work is fundamental to an understanding of financial markets generally. Of particular interest is the puzzling existence of high initial returns to equity IPOs in the United States and other free-market economies. Audience: Designed for use by anyone wishing to perform further academic research in the area of IPOs and by those practitioners interested in IPOs as investment vehicles.
Download or read book Asymmetric Information relating to Initial Public Offering Underpricing written by Fotini Mastroianni and published by GRIN Verlag. This book was released on 2017-05-03 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: Essay from the year 2012 in the subject Economics - Finance, , language: English, abstract: The main reason why companies decide to proceed with IPO is mainly to gain access to new funding. The proceeds from the share issue itself are not necessarily intended for direct expansion. The prospects for growth from acquisitions, the funds available for organizational expansion and refinancing of current borrowings have shown, among other things, to be the main motives that newly listed companies consider as very important. The general initial public offering procedure enhances the image and publicity of enterprises and gets not only an initial certification of the professionals in the financial markets but also a long-term price bidding (price signal) to suppliers, workforce and customers. According to Roell (1996), a robust equity value in the subsequent acquisition (during the trading of securities after their initial bid for public offering) reassures suppliers that they can safely grant trade credit, employees are convinced that they can expect a fairly stable job, and customers think that the products of the company will be supported as a result of their purchase (in the aftermath of their purchase).
Download or read book IPO Underpricing Phenomenon written by Stefano Nora and published by . This book was released on 1997 with total page 76 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Initial Public Offerings IPO written by Greg N. Gregoriou and published by Elsevier. This book was released on 2011-04-01 with total page 463 pages. Available in PDF, EPUB and Kindle. Book excerpt: After the cooling off of IPOs since the dot com bubble, Google has rekindled the fire for IPOs. This IPO reader contains new articles exclusive to this reader by leading academics from around the world dealing with quantitative and qualitative analyses of this increasingly popular and important area of finance. Articles address new methods of IPO performance, international IPOs, IPO evaluation, IPO underwriting, evaluation and bookbuilding. Although numerous articles are technical in nature, with econometric and statistical models, particular attention has been directed towards the understanding and the applicability of the results as well as theoretical development in this area. This reader will assist researchers, academics, and graduate students to further understand the latest research on IPOs.*Interest in IPOs is increasing again after the Google IPO, and IPOs are up significantly from last year*Chapters by well known academics provide an international perspective, describing research results from IPO data in countries spanning the globe*Research is based on real results from IPO data collected over the past 5-7 years
Download or read book Initial Public Offerings written by Michelle Lowry and published by . This book was released on 2017 with total page 166 pages. Available in PDF, EPUB and Kindle. Book excerpt: The purpose of this monograph is to provide an overview of the IPO literature since 2000. The fewer numbers of companies going public in recent years has raised many questions regarding the IPO process, in both academic and regulatory circles. As we all strive to understand these changes in the market, it is especially important to understand the dynamics underlying the IPO process. If the process of going public is too costly or the IPO mechanism is plagued by too many conflicts of interest among the various intermediaries, then private companies may rationally choose other methods of raising capital. In a related vein, it is imperative that new regulations not be based on research focusing solely on large, more mature firms. Newly public firms have unique characteristics, and an increased understanding of such issues will contribute positively to well-functioning public markets and further growth of the entrepreneurial sector. We also provide a detailed guide to researchers on how to obtain a research-quality sample of IPOs, from standard data sources. Related to this, we tabulate important corrections to these standard data sources.
Download or read book Capital Markets Handbook written by John C. Burch and published by Wolters Kluwer. This book was released on 2005-01-01 with total page 1458 pages. Available in PDF, EPUB and Kindle. Book excerpt: Capital Markets Handbook, Sixth Edition is the definitive desk reference for capital market professionals and a complete resource for anyone working in the financial markets field. Written by seasoned professionals in association with the SIA, Capital Markets Handbook covers the latest developments in major securities legislation, and all aspects of documentation, underwriting, pricing, distribution, settlement, immediate aftermarket trading of new issues, compliance issues, a glossary, a bibliography, and appendices containing the full text of the primary statutes and regulations. The Sixth Edition includes coverage of new developments, including compliance issues such as: New amendments to NASD Rule 2710 ("The Corporate Financing Rule") governing underwriting compensation Updates on PIPE and Registered Direct Transactions Amendments to Rule 10b-18 governing corporate repurchase of equity securities Online Dutch auction procedures in use for the Google, Inc. IPO United Kingdom Financial Service Authority guidance on conflict of interest regarding pricing and allocation issues which have been adopted by one major U.S. investment bank Amendments to Rule 105 Regulation M concerning short selling in connection with public offerings Currency conversion in settlement of a global offering NASD Rule 2790-Restriction on the Purchase and Sale of IPO equity securities NASD IPO Distribution Manager procedures for filing with NASD Corporate Financing Proposed NASD Rule 2712 concerning allocation and distribution of shares in an initial public offering A reorganized compliance chapter in a checklist format designed to ease and enhance CEO and CFO Compliance Certification required by a proposed amendment to NASD Rule 3010 (Supervision) and the adoption of Interpretive Material 3010-1 And more
