An Examination of the Underpricing of Initial Public Offerings in Hong Kong: 1980–90

McGuinness, Paul B.

doi:10.1111/j.1468-5957.1992.tb00617.x

Cited by 101 publications

(55 citation statements)

References 35 publications

(67 reference statements)

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“…There is overwhelming evidence that underpricing is higher in buoyant stock markets: among others, Davis and Yeomans (1976) for the UK, Reilly (1977) in the US, McGuinness (1992) in Hong Kong and Rydqvist (1993) in Sweden all show that initial returns tend to be higher following periods of high returns on the market index. In Germany, IPOs are more heavily underpriced not only when the market is performing well, but also in macroeconomic upswings and when already-listed firms issue historically large amounts of seasoned equity (Ljungqvist, 1995).…”

Section: Specific Characteristics Of the Spanish Market And Hypothesesmentioning

confidence: 99%

Pricing IPOs: An Approach for Spanish Firms

Álvarez¹

2015

JFBM

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The purpose of this paper is to analyse how IPO initial return volatility affects the valuation of firms that go public. The goal is to test whether the initial return volatility for evaluating the pricing of IPOs is relevant on the Spanish capital market, bearing in mind that the degree of ex-ante uncertainty regarding the value of the firm for IPOs in Spain is lower than in other countries, as is the level of underpricing. I also analyse how the main explanations found in the literature for the anomaly of underpricing are affected by this new metric of return volatility. The methodology used is maximum likelihood estimation (MLE) because it has important advantages. The main advantage of this approach is that it allows the estimation of the influence of each characteristic on both the level and the uncertainty of firm-level initial returns. The MLE affects positively to the efficiency of the estimations. Consistent with IPO theory, both the asymmetry of information hypothesis and the hot IPO market hypothesis are confirmed in this study. The results do not provide conclusive support for the signalling hypothesis for underpricing.

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Section: Specific Characteristics Of the Spanish Market And Hypothesesmentioning

confidence: 99%

Pricing IPOs: An Approach for Spanish Firms

Álvarez¹

2015

JFBM

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“…The problem with the application of the Rock model is that the ex-ante uncertainty is usually unobservable and impossible to measure directly. Therefore, following the literature, we used the proxy of the volatility of daily returns in the early aftermarket [Ritter 1984;McGuinness 1992]. We also involved other proxies of uncertainty, the size of the firm being one of them.…”

Section: Review Of the Previous Studiesmentioning

confidence: 99%

Does Timing Matter for the Determinants of Ipo Short-Term Returns? Evidence From the Top Emerging Markets

Lizińska

Czapiewski

2015

Folia Oeconomica

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The study examined the short-term price behavior of initial public offerings (IPOs) of equities listed on the top emerging market exchanges during the period from 2005 to 2012. We investigated whether underpricing could be explained with models based on stakeholder rationality and those concerning behavioral factors. There were extremely high initial, two- and four-week returns in the three top emerging markets during the sample period. The results documented the existence of significant differences in IPO short-term returns between initial equity issues offered in hot- versus cold-and-neutral markets. It was also found that the amount of money left on the table during initial public offerings was related most to the uncertainty, signaling and timing proxies. The study showed that the explanations for high initial returns were, to some extent, influenced by IPO timing.

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“…Aset emiten yang dilihat dari total asset perusahaan mampu memberikan sinyal bahwa perusahaan memiliki asset yang besar akan memiliki prospek yang baik. Beberapa penelitian yang meneliti keterkaitan asset emiten dengan keuntungan pertama investasi dengan menggunakan pendekatan total asset adalah penelitian yang dilakukan oleh Guinness (1992), penelitian tersebut berfokus pada reputasi penjamin emisi, reputasi auditor, nilai kapitalisasi, total asset, standar deviasi return dan standar deviasi Hang Seng Index terhadap initial return dan menemukan adanya pengaruh positif standar deviasi return dan standar deviasi Hang Seng Index terhadap initial return, sedangkan reputasi penjamin emisi, reputasi auditor, nilai kapitalisasi, dan total asset tidak berpengaruh terhadap return awal.…”

Section: Total Aset Emitenunclassified

“…(1993) yang diterapkan pada penelitian ini ternyata menunjukkan hasil yang konsisten pada pasar modal Indonesia yaitu saham perusahaan yang melakukan IPO dengan tujuan investasi atau mem peroleh sumber pembiayaan baru mempengaruhi herding ketika saham diperdagangkan pertama kali di bursa saham, meskipun demikian pengaruh tersebut secara statistik tidak signifikan atau dapat dikatakan pengaruh motif IPO perusahaan hanya memberikan sedikit sumbangan terhadap fenomena herding. Hasil pada variabel total asset emiten terhadap herding menunjukkan hasil yang tidak sejalan dengan penelitian Guinness (1992), temuan penelitian menunjukkan terdapat hubungan antara total asset emiten dengan herding. Hubungan tersebut bersifat searah yaitu jika total asset emiten semakin besar, akan semakin meningkakan terjadinya herding behavior, dan hasil ini secara statistik signifikan pada 5%.…”

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Pengaruh motif IPO dan total aset emiten terhadap herding behavior pada pasar modal Indonesia

Armansyah

2015

JBB

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An Examination of the Underpricing of Initial Public Offerings in Hong Kong: 1980–90

Cited by 101 publications

References 35 publications

Pricing IPOs: An Approach for Spanish Firms

Pricing IPOs: An Approach for Spanish Firms

Does Timing Matter for the Determinants of Ipo Short-Term Returns? Evidence From the Top Emerging Markets

Pengaruh motif IPO dan total aset emiten terhadap herding behavior pada pasar modal Indonesia

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