Car Associated With SEO Share Lockups: Real or Illusionary?

Posted: 5 Aug 2018

See all articles by Beng Soon Chong

Beng Soon Chong

Nanyang Technological University (NTU) - Nanyang Business School

Zhenbin Liu

Hong Kong Baptist University

Date Written: March 1, 2015

Abstract

This paper examines the cumulative abnormal return (CAR) associated with both the expiration and initiation of SEO share lockups. First, we find that the average CAR around the expiration of SEO share lockups is significantly negative, but this result is mainly attributed to inappropriate benchmarking of the CAR. Second, there is also, on average, a significant negative CAR at the initiation of SEO share lockups, but the negative CAR is a temporary phenomenon that reverses itself within a short period of time. Overall, our findings do not support the downward sloping demand curve hypothesis on the lockup expiration effect.

Keywords: SEO, Lockup Expiration, Cumulative Abnormal Return, Efficient Market, Downward Sloping Demand Curve, Temporary Price Pressure

JEL Classification: G00, G14, G24, G3

Suggested Citation

Chong, Beng Soon and Liu, Zhenbin, Car Associated With SEO Share Lockups: Real or Illusionary? (March 1, 2015). Review of Quantitative Finance and Accounting, Vol. 47, 2016. Available at SSRN: https://ssrn.com/abstract=3207971

Beng Soon Chong (Contact Author)

Nanyang Technological University (NTU) - Nanyang Business School ( email )

Singapore, 639798
Singapore

Zhenbin Liu

Hong Kong Baptist University ( email )

Kowloon Tong, Kowloon
Hong Kong

HOME PAGE: http://aclw.hkbu.edu.hk/eng/faculty/admin-details.jsp?id=zbliuHKB&cv=00069&cid=306&cp=1

Register to save articles to
your library

Register

Paper statistics

Abstract Views
495
PlumX Metrics