Underpricing, ownership dispersion, and aftermarket liquidity of IPO stocks

Zheng, Steven Xiaofan; Li, Mingsheng

doi:10.1016/j.jempfin.2007.08.001

Cited by 37 publications

(33 citation statements)

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“…In addition, CEOs who value post-IPO liquidity may favor larger first-day returns if underpricing increases stock liquidity after the IPO (Booth and Chua, 1996). Consistent with this hypothesis, Zheng and Li (2008) report that underpricing is used to attract nonblock institutional shareholders, which improves post-IPO liquidity.…”

Section: Ipo Pricing and Its Effect On Underpricingmentioning

confidence: 76%

An analysis of the liquidity benefits provided by secondary markets

Mantecon

Poon

2009

Journal of Banking & Finance

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Section: Ipo Pricing and Its Effect On Underpricingmentioning

confidence: 76%

An analysis of the liquidity benefits provided by secondary markets

Mantecon

Poon

2009

Journal of Banking & Finance

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“…G. Ibbotson, 1975;Pagano et al, 1998;Saunders, 1990). Many authors have proved that a great number of new issues in general have underpriced IPOs (Booth and Chua, 1996;Brau et al, 2012;Li, 2011;Ritter, 1995, 2004;Ritter, 1998Ritter, , 2003Zheng and Li, 2008).…”

Section: Literature Reviewmentioning

confidence: 99%

IPOs Performance Analysis: Evidence from Emerging Markets in the Balkans

Karanović¹,

Karanović²

2016

Scientific Annals of Economics and Business

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“…While most of the research on IPOs has focused on explaining the underpricing phenomenon, few studies have investigated the determinants of after-market liquidity (see Pham et al, 2003;Corwin et al, 2004;Li et al, 2005;Zheng et al, 2005;Ellul and Pagano, 2006;and Zheng and Li, 2008). For this reason we focus our attention on liquidity for the post-listing period.…”

Section: Ipo Characteristics and Influence On Liquiditymentioning

confidence: 99%

“…Pham et al (2003) claim that this relationship is due to the dispersion of the ownership structure brought about by the IPO. Recently, another study focusing on the U.S. market by Zheng and Li (2008) (1) See Álvarez (2008) and Álvarez and González (2005) for underpricing and long-run performance of Spanish IPOs.…”

Section: Introductionmentioning

confidence: 99%

Influence of IPO characteristics on liquidity

Ramírez¹,

Cabestre²,

Aquilué

2011

Spanish Journal of Finance and Accounting / Revista Española de

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This study examines the relationship between the characteristics that defi ne initial public offerings (IPOs) and the post-offering liquidity of stocks outstanding. We argue that higher underpricing, relative size and retail composition of the offerings will result in higher post-listing liquidity. Based on a sample of Spanish IPOs, our results reveal that liquidity can be explained by a set of IPO characteristics. Furthermore, the results remain robust after removing the market effect and adding other IPO characteristics, such as stabilization agreements, lockup restrictions and the reputation of underwriters, insurers and auditors.RESUMEN Este estudio examina la relación existente entre las características que defi nen las Ofertas Públicas de Venta Iniciales (OPIs) y la liquidez de las acciones en circulación tras la ejecución de estas operaciones. Se argumenta que a mayor infravaloración, tamaño relativo y composición minorista de las ofertas, mayor será la liquidez de las acciones tras la admisión a cotización. Los resultados procedentes de una muestra de OPIs del mercado bursátil español revelan que la liquidez, tras la ejecución de estas operaciones, puede ser explicada por las características que las defi nen. Además, éstos permanecen robustos tras excluir el efecto del mercado e incluir otras características adicionales de las OPIs tales comos compromisos de estabilización, restricciones lockup y reputación de coordinadores, aseguradores y auditores.

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Underpricing, ownership dispersion, and aftermarket liquidity of IPO stocks

Cited by 37 publications

References 37 publications

An analysis of the liquidity benefits provided by secondary markets

An analysis of the liquidity benefits provided by secondary markets

IPOs Performance Analysis: Evidence from Emerging Markets in the Balkans

Influence of IPO characteristics on liquidity

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