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Return Behavior of Initial Public Offerings and Market Efficiency

Belden, Fernando and Chenine, Mohammad (2007)
Department of Business Administration
Abstract
This paper is an event study on Initial Public Offering’s return behavior after the dot com bubble. Cumulative Abnormal Returns are used to measure the performance against a market index. The results suggest that the market correctly prices IPOs in the long run thus upholding the Market Efficiency hypothesis. Moreover, value weighted CARs show that large IPOs are more likely to outperform smaller IPOs, however in the long run there is an unpredictable pattern. The study found float and previous market return as significant variables for the short term returns. As for the long term, significant variables were found to be the enlisting market and the ratio of Volume of shares traded on the first day to Shares offered.
Please use this url to cite or link to this publication:
author
Belden, Fernando and Chenine, Mohammad
supervisor
organization
year
type
H1 - Master's Degree (One Year)
subject
keywords
IPO behavior, Market Efficiency, Management of enterprises, Företagsledning, management
language
Swedish
id
1343506
date added to LUP
2007-06-04 00:00:00
date last changed
2012-04-02 16:33:25
@misc{1343506,
  abstract     = {{This paper is an event study on Initial Public Offering’s return behavior after the dot com bubble. Cumulative Abnormal Returns are used to measure the performance against a market index. The results suggest that the market correctly prices IPOs in the long run thus upholding the Market Efficiency hypothesis. Moreover, value weighted CARs show that large IPOs are more likely to outperform smaller IPOs, however in the long run there is an unpredictable pattern. The study found float and previous market return as significant variables for the short term returns. As for the long term, significant variables were found to be the enlisting market and the ratio of Volume of shares traded on the first day to Shares offered.}},
  author       = {{Belden, Fernando and Chenine, Mohammad}},
  language     = {{swe}},
  note         = {{Student Paper}},
  title        = {{Return Behavior of Initial Public Offerings and Market Efficiency}},
  year         = {{2007}},
}