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Cross listing waves

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  • Sarkissian, Sergei
  • Schill, Michael

Abstract

Using a 57-year global panel of listings on foreign stock exchanges, we identify waves in foreign listing activity at the host market, home market, and industry levels. We observe that the waves in the host market are often due to cross-listing waves in home markets or industries that share a particular affiliation with the respective host market. We then find that cross-listing waves in a given host country or from a given home country largely coincide with the outperformance of that country’s economy and financial markets relative to other competing markets. We also show that firms that list their shares during waves are associated with a temporary value premium. Our results provide novel evidence of non-monotonic market development across countries and over time.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 27545.

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Date of creation: 2010
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Handle: RePEc:pra:mprapa:27545

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Keywords: Firm valuation; Market competitiveness; Market timing; Stock exchanges;

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References

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  2. Doidge, Craig & Karolyi, G. Andrew & Stulz, Rene M., 2004. "Why Do Countries Matter So Much for Corporate Governance?," Working Paper Series 2004-16, Ohio State University, Charles A. Dice Center for Research in Financial Economics.
  3. Edison, Hali J. & Warnock, Francis E., 2008. "Cross-border listings, capital controls, and equity flows to emerging markets," Journal of International Money and Finance, Elsevier, Elsevier, vol. 27(6), pages 1013-1027, October.
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  9. Rajan, Raghuram G. & Zingales, Luigi, 2003. "The great reversals: the politics of financial development in the twentieth century," Journal of Financial Economics, Elsevier, Elsevier, vol. 69(1), pages 5-50, July.
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  14. Sergei Sarkissian, 2004. "The Overseas Listing Decision: New Evidence of Proximity Preference," Review of Financial Studies, Society for Financial Studies, Society for Financial Studies, vol. 17(3), pages 769-809.
  15. Miller, Darius P., 1999. "The market reaction to international cross-listings:: evidence from Depositary Receipts," Journal of Financial Economics, Elsevier, Elsevier, vol. 51(1), pages 103-123, January.
  16. Fernandes, Nuno & Giannetti, Mariassunta, 2013. "On the fortunes of stock exchanges and their reversals: evidence from foreign listings," Working Paper Series, European Central Bank 1585, European Central Bank.
  17. Stephen R. Foerster & G. Andrew Karolyi, 1999. "The Effects of Market Segmentation and Investor Recognition on Asset Prices: Evidence from Foreign Stocks Listing in the United States," Journal of Finance, American Finance Association, American Finance Association, vol. 54(3), pages 981-1013, 06.
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  20. Doidge, Craig & Karolyi, G. Andrew & Stulz, Rene M., 2004. "Why are foreign firms listed in the U.S. worth more?," Journal of Financial Economics, Elsevier, Elsevier, vol. 71(2), pages 205-238, February.
  21. Sergei Sarkissian & Michael J. Schill, 2009. "Are there permanent valuation gains to overseas listing?," Review of Financial Studies, Society for Financial Studies, Society for Financial Studies, vol. 22(1), pages 371-412, January.
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Cited by:
  1. Korczak, Adriana & Korczak, Piotr, 2013. "The development of emerging stock markets and the demand for cross-listing," Journal of Empirical Finance, Elsevier, Elsevier, vol. 24(C), pages 63-77.
  2. Cécile Carpentier & Douglas Cumming & Jean-Marc Suret, 2010. "The Valuation Effect of Listing Requirements: An Analysis of Venture Capital-Backed IPOs," CIRANO Working Papers, CIRANO 2010s-01, CIRANO.
  3. Fernandes, Nuno & Giannetti, Mariassunta, 2009. "On the Fortunes of Stock Exchanges and Their Reversals: Evidence from Foreign Listings," CEPR Discussion Papers, C.E.P.R. Discussion Papers 7308, C.E.P.R. Discussion Papers.
  4. Sarkissian, Sergei & Schill, Michael, 2010. "Why are U.S. firms listed in foreign markets worth more?," MPRA Paper 27543, University Library of Munich, Germany.
  5. Thomas O'Connor, 2012. "Legal bonding, investor recognition, and cross-listing premia in emerging markets," Economics, Finance and Accounting Department Working Paper Series, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth n226-12.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.

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