This study investigates the low-price effect on the Polish stock market. By adopting sorting, cross-sectional tests and checks of the monotonic relation, we have examined the performance of the portfolios formed on the prices of over 850 companies listed on the Polish stock market within the years 2000-2014. Contrary to the globally prevailing evidence, the expensive stocks have significantly outperformed the cheap stocks. Additional sorts on value, size and momentum may be used further to improve the price-based strategies while the strongest anomaly has been identified among the growth companies. We hypothesize that the reverse character of the low-price anomaly may be explained by the impact of another phenomena: the underperformance of lottery-stocks. With the exception of the growth stocks, the reverse low-price effect is no longer significant after the exclusion of NewConnect companies. Finally, by adopting an alternative methodology, we have provided convincing out-of-sample evidence in support of the hypothesis of Baker et al. (2009) stating that corporate managers cater to investors by splitting their company shares in response to time-varying catering incentives.
The following paper aims to assess investor reaction to mandatory offers on the Warsaw Stock Exchange, which is important because knowledge about these reactions can be used to make better investment decisions. This paper highlights the importance of procedure in making a mandatory offer and its grounds in the Polish legal system. Additionally, it presents empirical research on the reactions of investors to mandatory offers on the Warsaw Stock Exchange. It has been provided that mandatory offers have a significant impact on the price of a company’s shares listed on the Warsaw Stock Exchange. Knowledge about the reactions of investors to a mandatory offer may be used when selecting securities for an investment portfolio. The findings may provide guidance in deciding whether to begin or end investment in the company, both for individual and institutional investors. The event study methodology approach used in the paper is regarded as valuable and can be the basis for further research in other areas of the capital market research, especially in the context of information efficiency
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