Abstract

http://ssrn.com/abstract=906779
 
 

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Investor Demand for IPOs and Aftermarket Performance: Evidence from the Hong Kong Stock Market


Sumit Agarwal


National University of Singapore

Chunlin Liu


University of Nevada, Reno - College of Business

S. Ghon Rhee


University of Hawaii at Manoa - Shidler College of Business


Journal of International Financial Markets, Institutions and Money, Forthcoming

Abstract:     
In this study, we examine the relation between investor demand for IPOs prior to offerings and aftermarket performance of IPO firms in the Hong Kong stock market. The paper finds that IPOs with high investor demand have large positive initial returns but negative long-run excess returns, while IPOs with low investor demand have negative initial returns but positive long-run excess returns. This study demonstrates that investor demand for IPOs is possibly driven by investors' overreaction (either optimistic or pessimistic) to the information about IPO firm prospects prior to offerings.

Keywords: Initial Public Offering, Aftermarket Performance, Investor Demand

JEL Classification: G12, G14, G24

Accepted Paper Series


Not Available For Download

Date posted: June 7, 2006  

Suggested Citation

Agarwal, Sumit and Liu, Chunlin and Rhee, S. Ghon, Investor Demand for IPOs and Aftermarket Performance: Evidence from the Hong Kong Stock Market. Journal of International Financial Markets, Institutions and Money, Forthcoming. Available at SSRN: http://ssrn.com/abstract=906779

Contact Information

Sumit Agarwal (Contact Author)
National University of Singapore ( email )
15 Kent Ridge Drive
Singapore, 117592
Singapore
8118 9025 (Phone)
HOME PAGE: http://www.ushakrisna.com
Chunlin Liu
University of Nevada, Reno - College of Business ( email )
University of Nevada, Reno
Reno, NV 89557-0016
United States
S. Ghon Rhee
University of Hawaii at Manoa - Shidler College of Business ( email )
2404 Maile Way
C-304, FEI/CBA
Honolulu, HI 96822
United States
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