Investor Recognition, Liquidity and Exchange Listings in the Reformed Markets

33 Pages Posted: 2 Mar 2004

See all articles by Pankaj K. Jain

Pankaj K. Jain

University of Memphis - Fogelman College of Business and Economics

Jang-Chul Kim

Northern Kentucky University - Haile/US Bank College of Business

Multiple version iconThere are 2 versions of this paper

Date Written: August 2005

Abstract

We examine multiple facets of firms' decisions to list on the NYSE. Although the average Nasdaq spreads are now comparable to the average NYSE spreads, we find that firms continue to switch from Nasdaq to the NYSE, and that they experience positive cumulative abnormal returns on listing. Using a simultaneous system of equations approach, we establish that enhanced investor recognition mainly explains this phenomenon. A logistic regression suggests that corporate listing choice is consistent with these findings, since eligible unlisted firms already have high volumes and recognition and might not benefit as much as do firms that actually switch.

Keywords: NYSE. switch exchange listing, liquidity, decimalization

JEL Classification: G10, G14

Suggested Citation

Jain, Pankaj K. and Kim, Jang-Chul, Investor Recognition, Liquidity and Exchange Listings in the Reformed Markets (August 2005). Available at SSRN: https://ssrn.com/abstract=511368 or http://dx.doi.org/10.2139/ssrn.511368

Pankaj K. Jain

University of Memphis - Fogelman College of Business and Economics ( email )

Memphis, TN 38152
United States

Jang-Chul Kim (Contact Author)

Northern Kentucky University - Haile/US Bank College of Business ( email )

Dept of Accounting, Finance, and Business Law
Highland Heights, KY 41099
United States
859-572-1486 (Phone)

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