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Information asymmetries and the underpricing of European IPOs

Balsom, Sebastian LU (2020) NEKN02 20201
Department of Economics
Abstract
IPO underpricing is an international phenomenon that has been documented by numerous authors. However, the IPO market keeps evolving. Since the decline in IPO volume following the “dot-com bubble”, there have been periods with high IPO volume, as well as periods with low IPO volume. This paper uses a linear regression model and t-tests to investigate underpricing of European IPOs between 2001 and 2019. The paper is formed around asymmetric information theories and shows that the level of underpricing tends to be greater for IPOs with certain firm and IPO characteristics that are associated with higher degree of information asymmetries. However, very limited evidence on IPO determinants is found.
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author
Balsom, Sebastian LU
supervisor
organization
course
NEKN02 20201
year
type
H1 - Master's Degree (One Year)
subject
keywords
Initial public offerings, Information asymmetries, Initial returns, Cyclicality, European IPO markets
language
English
id
9029102
date added to LUP
2021-03-16 15:10:46
date last changed
2021-03-16 15:10:46
@misc{9029102,
  abstract     = {{IPO underpricing is an international phenomenon that has been documented by numerous authors. However, the IPO market keeps evolving. Since the decline in IPO volume following the “dot-com bubble”, there have been periods with high IPO volume, as well as periods with low IPO volume. This paper uses a linear regression model and t-tests to investigate underpricing of European IPOs between 2001 and 2019. The paper is formed around asymmetric information theories and shows that the level of underpricing tends to be greater for IPOs with certain firm and IPO characteristics that are associated with higher degree of information asymmetries. However, very limited evidence on IPO determinants is found.}},
  author       = {{Balsom, Sebastian}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Information asymmetries and the underpricing of European IPOs}},
  year         = {{2020}},
}