Empirical Evidence on IPO-Underpricing

Business & Finance, Finance & Investing, Finance
Cover of the book Empirical Evidence on IPO-Underpricing by Marius Hamer, GRIN Publishing
View on Amazon View on AbeBooks View on Kobo View on B.Depository View on eBay View on Walmart
Author: Marius Hamer ISBN: 9783638733434
Publisher: GRIN Publishing Publication: June 20, 2007
Imprint: GRIN Publishing Language: English
Author: Marius Hamer
ISBN: 9783638733434
Publisher: GRIN Publishing
Publication: June 20, 2007
Imprint: GRIN Publishing
Language: English

Diploma Thesis from the year 2007 in the subject Business economics - Investment and Finance, grade: 1,3, European Business School - International University Schloß Reichartshausen Oestrich-Winkel, 80 entries in the bibliography, language: English, abstract: This paper aims at establishing a link between the average level of initial return of IPO shares, existing underpricing explanations and the dot-com bubble. In years prior to the boom of the new economy, underpricing was explained by various theories, which have extensively been developed since decades. However, in the years 1998 to 2001 IPOs were overly underpriced, leading to assumptions about behavioural aspects and investor irrationality. Analysing a comprehensive dataset of 371 IPOs on the Frankfurter Börse between 1997 and 2007, this paper aims at providing evidence that the observed lower levels of initial returns in recent years can indeed be aligned with existing theories on the basis of rational behaviour of market participants. Firstly, the IPO process and its major participants will be presented followed by a review of relevant studies on the IPO phenomenon. In the next step, established underpricing theories are recapitulated. A descriptive analysis of the data sample points out the particularities concerning the company and transaction characteristics of the sample firms. In a last step, a regression analysis relates various proxies for information asymmetry to established underpricing theories. It gives reason to believe that the irrationality at the turn of the century has vanished and that underpricing can again be explained by established theories.

View on Amazon View on AbeBooks View on Kobo View on B.Depository View on eBay View on Walmart

Diploma Thesis from the year 2007 in the subject Business economics - Investment and Finance, grade: 1,3, European Business School - International University Schloß Reichartshausen Oestrich-Winkel, 80 entries in the bibliography, language: English, abstract: This paper aims at establishing a link between the average level of initial return of IPO shares, existing underpricing explanations and the dot-com bubble. In years prior to the boom of the new economy, underpricing was explained by various theories, which have extensively been developed since decades. However, in the years 1998 to 2001 IPOs were overly underpriced, leading to assumptions about behavioural aspects and investor irrationality. Analysing a comprehensive dataset of 371 IPOs on the Frankfurter Börse between 1997 and 2007, this paper aims at providing evidence that the observed lower levels of initial returns in recent years can indeed be aligned with existing theories on the basis of rational behaviour of market participants. Firstly, the IPO process and its major participants will be presented followed by a review of relevant studies on the IPO phenomenon. In the next step, established underpricing theories are recapitulated. A descriptive analysis of the data sample points out the particularities concerning the company and transaction characteristics of the sample firms. In a last step, a regression analysis relates various proxies for information asymmetry to established underpricing theories. It gives reason to believe that the irrationality at the turn of the century has vanished and that underpricing can again be explained by established theories.

More books from GRIN Publishing

Cover of the book Environmental Auditing by Marius Hamer
Cover of the book The revival of ancient Hindu values towards female sexuality by Marius Hamer
Cover of the book Marxist and Neo-Marxist Theories of Class by Marius Hamer
Cover of the book 'A photograph without space and time'. Functions, Values and Messages of the 'generated-through software photograph' (GSP) by Marius Hamer
Cover of the book Peacekeeping and the United Nations in Mozambique by Marius Hamer
Cover of the book Nathaniel Hawthorne's 'Legends of the Province House' in relation to historical documents by Marius Hamer
Cover of the book Confronting Human Rights violations in Argentinean, Chilean and Venezuelan prisons by Marius Hamer
Cover of the book Concord with collective nouns in British and American English by Marius Hamer
Cover of the book Travels with Leni by Marius Hamer
Cover of the book Analyzing gender relations within 'Mad Men' by Marius Hamer
Cover of the book Chris Ryan Firefight - Spezialgebiet, Inhaltsübersicht by Marius Hamer
Cover of the book Rise and Burst of the Dotcom Bubble by Marius Hamer
Cover of the book Variation in Scotland: The Linguistic Status of Scots Then and Now by Marius Hamer
Cover of the book Sterne's writing and conversational style. A co-operative work between the author and the reader by Marius Hamer
Cover of the book Language shift and death of indigenous languages in Australia by Marius Hamer
We use our own "cookies" and third party cookies to improve services and to see statistical information. By using this website, you agree to our Privacy Policy