Underwriter networks, investor attention, and initial public offerings

Bajo, Emanuele; Chemmanur, Thomas J.; Simonyan, Karen; Tehranian, Hassan

doi:10.1016/j.jfineco.2015.12.001

Cited by 190 publications

(73 citation statements)

References 66 publications

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“…In which by using a reputable underwriter, it will have a greater ability to predict the future profitability of companies that issue shares and give a positive signal to investors. Furthermore, Bajo et al (2016) found that IPO companies underwritten by underwriters who are already well-known by the investors produce greater participation from some financial market participants. H 1 : Underwriter's reputation has a positive effect on investor decisions.…”

Section: Literature Review and Hypothesis Formulation The Effect Of Umentioning

confidence: 99%

The Benchmark of Investor Decisions to Invest in the Initial Public Offering (Ipo)

Kurniawati

Sutrisno

2019

REAKSI

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This study aimed at examining the influence of the benchmark used by investors in the investment decisionmaking process at IPO. The dependent variable in this study was the investment decision while the independent variables were in the form of financial behavior bias consisting of underwriter reputation, CEO reputation, financial statement, representativeness bias, availability bias, overconfidence bias, and self-control bias. Primary data were collected by giving questionnaires to investors who invest at IPO. The population was investors in Yogyakarta with sample of 100 respondents taken by purposive sampling method according to specified criteria. The questionnaire was tested with a validity test and a reliability test. Furthermore, multiple regression analysis was used to test the hypothesis. The results of this study indicated that underwriter reputation, CEO reputation, financial statements, representativeness bias, and availability bias did not affect investment decision-making during the IPO process. While overconfidence bias and self-control bias had a significant positive effect on investment decisionmaking during the IPO process.

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Section: Literature Review and Hypothesis Formulation The Effect Of Umentioning

confidence: 99%

The Benchmark of Investor Decisions to Invest in the Initial Public Offering (Ipo)

Kurniawati

Sutrisno

2019

REAKSI

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“…An underwriting syndicate can leverage its ties to a wider pool of institutional investors than any individual bank and deliver a superior service to the issuer by reducing the costs of offering and maximizing proceeds (Pichler & Wilhelm, 2001;Pollock et al, 2004). Securities underwriters with high network centrality can leverage their network both to disseminate information and to extract information relevant to the pricing of new offerings (Bajo, Chemmanur, Simonyan, & Tehranian, 2016). The inclusion of reputable co-managers and commercial banks in underwriting syndicates is documented to lead to lower floatation costs and, consequently, higher net proceeds for issuers (Jeon & Ligon, 2011).…”

Section: Literature and Hypothesesmentioning

confidence: 99%

Cluster dynamics of financial centres in the UK: do connected firms grow faster?

Pažitka

Wójcik

2018

Regional Studies

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This study investigates the connection between network centrality and firm growth on a sample of 3224 financial services firms located in the UK in the aftermath of the global financial crisis. The findings, based on a spatial econometric model of long-term firm growth, indicate that firms that span structural holes, engage in co-management appointments and have network connections to related companies in other financial centres grow faster. In contrast, such connections generate substantial negative indirect effects on proximate firms, leading to a divergence of growth rates between globally connected and locally embedded firms.

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“…We start our analysis from 1996 because, prior to this year, the percentage of IPOs with when-issued markets was very low (less than 5%). It is common practice for IPO studies (Boulton andCampbell, 2016 andBajo, Chemmanur, Simonyan, andTehranian, 2016) to exclude firms from the financial sector. Most of the financial sector firms report their assets and liabilities differently as compared to non-financial firms.…”

Section: Methodsmentioning

confidence: 99%