Does Cross-Listing Benefit the Shareholders? Evidence from Companies in the GCC Countries?

The determinants of dual listing decision of firms from ASEAN-5

“…The benefits realized from listing abroad encourage firms to pursue dual listing to reduce trading and capital costs, increase investor recognition, and widen the financial sources of firms by offering their securities in more than one market (Dobbs & Goedhart, 2008;Ghadhab & M'rad, 2018;Roosenboom et al, 2009;You et al, 2013). The dual listing enlarges the firms' investors base; helps them overcome the lack of liquidity; improves stock liquidity, stock price informativeness, visibility, investor protection; decreases the cost of capital, and increases the firms' value (Bahlous, 2013;Ghadhab & M'rad, 2018;Kariuki, 2015;Mu, 2014). This is in turn expected to improve firms' growth opportunities compared to their counterparts and encourage investors to add new foreign securities to their portfolio.…”

“…Besides that, scholars have also shown that the volatility in stock prices leads to abnormal returns as a result of high risks, which are affected by the standards, scrutiny, and disclosures required in the stock markets where the firms had listed their equities (Amiram et al, 2015;Ndirangu & Iraya, 2016). Listing in major exchanges such as the US is found to decrease stock price volatility because of the widening of investors' base and trading activities (Amiram et al, 2015;Bahlous, 2013;Jain & Strobl, 2016). However, the reduction in the stock volatility did not always occur; for example, the Gulf Cooperation Council Countries were found to suffer from an increase in abnormal returns (Bahlous, 2013).…”

“…Listing in major exchanges such as the US is found to decrease stock price volatility because of the widening of investors' base and trading activities (Amiram et al, 2015;Bahlous, 2013;Jain & Strobl, 2016). However, the reduction in the stock volatility did not always occur; for example, the Gulf Cooperation Council Countries were found to suffer from an increase in abnormal returns (Bahlous, 2013). ASEAN countries such as Malaysia, the Philippines, and Singapore suffered from high volatility due to low trading volumes (Wang, 2013).…”

“…Firms also aim to increase their equity capital, operations, financial performance, and firm value through an overseas listing. Meanwhile, investors are encouraged to add foreign securities to diversify their portfolios (Bahlous, 2013;Cherono, 2010;Karolyi, 2006;Ndirangu & Iraya, 2016;Zhou & Owusu-Ansah, 2014).…”

Strategic Change in Operating Trends of Public Listed Companies and Its Impact on StockMarket Growth

“…Besides, the cross-listing and its legal aspect as a consequence of the Sarbanes-Oxley Act as well as its benefits to new markets [Bahlous (2013)] are also the focus of discussion in various circles. However, little research has been carried out on the role of cross-listing in host stock market.…”