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The Nordic IPO Puzzle

Jakobsson, Gustav LU ; Jedmo, Filip LU and Tegmark, Daniel LU (2018) FEKH89 20172
Department of Business Administration
Abstract
Purpose:
To evaluate the Nordic IPO markets from an academic perspective taken from an investor's point view.

Methodology:
Quantitative research

Theoretical perspective:
Majority of previous research suggest that in the long run newly listed companies underperform comparable companies on the market when comparing changes in stock prices. However, there have been some studies that have found that IPOs in certain countries deliver a positive long run performance relative to comparable non-newly listed companies during the studied periods. This study looks at the Nordic market in order to see how Nordic IPOs perform in the long run relative to comparable companies on the market and what factors can be considered key drivers... (More)
Purpose:
To evaluate the Nordic IPO markets from an academic perspective taken from an investor's point view.

Methodology:
Quantitative research

Theoretical perspective:
Majority of previous research suggest that in the long run newly listed companies underperform comparable companies on the market when comparing changes in stock prices. However, there have been some studies that have found that IPOs in certain countries deliver a positive long run performance relative to comparable non-newly listed companies during the studied periods. This study looks at the Nordic market in order to see how Nordic IPOs perform in the long run relative to comparable companies on the market and what factors can be considered key drivers of the performance.

Empirical foundation:
567 companies were studied in the paper. These were companies that went public on Oslo Børs, Nasdaq Stockholm, Nasdaq Copenhagen and Nasdaq Finland during the period 1997-2014. Data from the companies and indexes were collected from Datastream.

Conclusions:
IPOs on the Nordic market on average tend to underperform their comparable benchmark. Number of issues, defined as number of new companies listed during a certain year, was shown to have a significant negative impact on long run performance of IPOs on the Nordic Market. With more IPOs during a specific year leading to a greater long run underperformance of IPOs listed during the same year. Long run performance of Nordic IPOs is also highly dependent on which country the IPOs occur in. Lastly, New Economy IPOs performed 32% better than IPOs active in Old Economy. (Less)
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author
Jakobsson, Gustav LU ; Jedmo, Filip LU and Tegmark, Daniel LU
supervisor
organization
course
FEKH89 20172
year
type
M2 - Bachelor Degree
subject
keywords
Long run performance, Nordic Market, BHAR, Number of Issues, IPO
language
English
id
8934952
date added to LUP
2018-02-07 14:16:24
date last changed
2018-02-07 14:16:24
@misc{8934952,
  abstract     = {Purpose:			
To evaluate the Nordic IPO markets from an academic perspective taken from an investor's point view.		

Methodology:			
Quantitative research 

Theoretical perspective:	
Majority of previous research suggest that in the long run newly listed companies underperform comparable companies on the market when comparing changes in stock prices. However, there have been some studies that have found that IPOs in certain countries deliver a positive long run performance relative to comparable non-newly listed companies during the studied periods. This study looks at the Nordic market in order to see how Nordic IPOs perform in the long run relative to comparable companies on the market and what factors can be considered key drivers of the performance. 

Empirical foundation:
567 companies were studied in the paper. These were companies that went public on Oslo Børs, Nasdaq Stockholm, Nasdaq Copenhagen and Nasdaq Finland during the period 1997-2014. Data from the companies and indexes were collected from Datastream. 

Conclusions:		
IPOs on the Nordic market on average tend to underperform their comparable benchmark. Number of issues, defined as number of new companies listed during a certain year, was shown to have a significant negative impact on long run performance of IPOs on the Nordic Market. With more IPOs during a specific year leading to a greater long run underperformance of IPOs listed during the same year. Long run performance of Nordic IPOs is also highly dependent on which country the IPOs occur in. Lastly, New Economy IPOs performed 32% better than IPOs active in Old Economy.},
  author       = {Jakobsson, Gustav and Jedmo, Filip and Tegmark, Daniel},
  keyword      = {Long run performance,Nordic Market,BHAR,Number of Issues,IPO},
  language     = {eng},
  note         = {Student Paper},
  title        = {The Nordic IPO Puzzle},
  year         = {2018},
}