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Delistings of Secondary Listings: Price and Volume Effects

Financial Markets and Portfolio Management, Vol. 24, No. 4, pp. 395-418, 2010

Posted: 20 Dec 2010  

Rico von Wyss

Bank Vontobel AG

Matthias Pfister

affiliation not provided to SSRN

Date Written: October 12, 2010

Abstract

Despite their growing importance in recent years, delistings of secondary listings have received very little attention. This article investigates whether a delisting is accompanied by any price or volume effects on the company’s primary exchange. We apply a standard event study methodology to analyze these effects. The total sample consists of 255 companies that either delisted from the SIX Swiss Exchange, the Sponsored Segment of the SIX, Deutsche Börse, or the Tokyo Stock Exchange. The results show no significant price effects, either around the announcement or around the effective delisting. Furthermore, the results vary considerably between subsamples. Prices tend to decline around announcement; however, the effect is not permanent. The effective delisting is preceded by declining prices, whereas the event itself has no influence. Overall, this initial decline appears to be permanent. In general, volumes seem to rise around the announcement as well as around the date of the delisting.

Keywords: Event Study, Secondary Listings, Delisting

JEL Classification: G12, G14, G39

Suggested Citation

von Wyss, Rico and Pfister, Matthias, Delistings of Secondary Listings: Price and Volume Effects (October 12, 2010). Financial Markets and Portfolio Management, Vol. 24, No. 4, pp. 395-418, 2010. Available at SSRN: https://ssrn.com/abstract=1728803

Rico Von Wyss (Contact Author)

Bank Vontobel AG ( email )

Gotthardstrasse 43
Zürich, 8000
Switzerland

Matthias Pfister

affiliation not provided to SSRN ( email )

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