Stock hyping before auction-style SEOs: Are primary market investors misled?

Gao, Shenghao; Liu, Jinzhao; Zhang, Qi; Zhou, Jun

doi:10.1016/j.iref.2023.06.023

Cited by 2 publications

(1 citation statement)

References 72 publications

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“…Because the capital market performs both financial and economic activities simultaneously, it plays a significant role in sustaining a nation's economy (Chen et al, 2020;Gao et al, 2023;Hanauer et al, 2024). The capital market is a venue for the exchange of securities between investors with surplus cash and firms in need of funding (Saputra, 2018;Wulandari, 2023).…”

Section: Introductionmentioning

confidence: 99%

Analysis of Investor Motivation to Buy GOTO and BUKA Shares

Mediaty,

Habbe,

Darwis

2024

jmef

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This study aims to determine the motivation of investors to buy shares in Gojek Tokopedia (GOTO) and Bukalapak (BUKA) companies. Investment motivation is a state in a person's personality that encourages the individual's desire to carry out certain activities to invest. In this study, a descriptive type of research is used which is one of the qualitative methods with the aim of the social situation to be studied. The data collection method used in this research is the Documentation technique. This research uses the literature study method, with the research objective of analyzing the motivation of investors to buy BUKA and GOTO shares. The result of this study is that although the profit generated by GOTO from 2022 to 2023 has decreased, GOTO investors continue to increase. This is due to GOTO shares which recently made it into the large cap list in the FTSE Global Asia Pacific series index (effective closing March 17, 2023) and the MSCI index (effective June 1, 2023). that is, GOTO companies have good fundamental movements and liquidity. Investor motivation in Bukalapak is quite high as evidenced by the increase in share price triggered by many investors.

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Section: Introductionmentioning

confidence: 99%

Analysis of Investor Motivation to Buy GOTO and BUKA Shares

Mediaty,

Habbe,

Darwis

2024

jmef

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Historical high prices and seasoned equity offerings: evidence from China

Xia,

Guo

2024

CFRI

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PurposeWe are the first to investigate the relationship between seasoned equity offerings (SEOs) and anchoring on historical high prices in China.Design/methodology/approachWe use the ratio of the recent closing price to its historical high in the previous 12–60 months (anchoring-high-price ratio) to study its impact on the market timing of SEOs.FindingsEmpirical results show that the anchoring-high-price ratio significantly and positively affects the probability of additional stock issuances. Contrary to the USA market, the Chinese stock market reacts negatively to the SEOs at historical highs. Moreover, the anchoring-high-price ratio exacerbates the negative effect of announcements and leads to long-term underperformance. Finally, we investigate the impact of the anchoring-high-price ratio on a company’s capital structure, showing that the additional issuance anchoring on historical highs reduces the company’s leverage ratio in the long run. Overall, our findings support the anchoring theory and can help understand better the anchoring behavior of managers and the company’s decision on additional stock issuances.Originality/valueWe are the first to use the anchoring-high-price ratio to study the timing of SEOs. We find that the anchoring-high-price ratio positively affects the probability of SEOs. Unlike the USA, the Chinese stock market reacts negatively to SEOs at high prices. SEOs anchoring on historical highs reduce a firm’s leverage ratio in the long run. Finally, our results support the anchoring theory.

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Stock hyping before auction-style SEOs: Are primary market investors misled?

Cited by 2 publications

References 72 publications

Analysis of Investor Motivation to Buy GOTO and BUKA Shares

Analysis of Investor Motivation to Buy GOTO and BUKA Shares

Historical high prices and seasoned equity offerings: evidence from China

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