IDEAS home Printed from https://ideas.repec.org/a/gam/jrisks/v11y2023i11p201-d1281501.html
   My bibliography  Save this article

Market Reaction to Delisting Announcements in Frontier Markets: Evidence from the Vietnam Stock Market

Author

Listed:
  • Loc Dong Truong

    (School of Economics, Can Tho University, Can Tho City 94115, Vietnam)

  • H. Swint Friday

    (RELLIS Campus, Texas A&M University, Bryan, TX 77807, USA)

  • Tran My Ngo

    (School of Economics, Can Tho University, Can Tho City 94115, Vietnam)

Abstract

This paper aims to measure the effects of delisting on stock returns for the Vietnam stock market. This study employs a sample of 118 stocks that were compulsorily delisted from the market between January 2011 and December 2021. Using an event study methodology, the empirical findings confirm that the delisting has negative effects on stock returns in the Vietnam stock market. Specifically, results derived from tests show that the average abnormal return of delisted stocks continuously declines during three trading days following the announcement of delisting. Moreover, it is found that the differences in cumulative abnormal returns between post-delisting and pre-delisting periods are significantly negative for all tracking periods. Apart from the negative effect of delisting on stock abnormal returns, we also find that the impact of delisting on stock returns for smaller companies is greater than for bigger companies. These results imply that investors can earn abnormal returns by using delisting information in the Vietnam stock market.

Suggested Citation

  • Loc Dong Truong & H. Swint Friday & Tran My Ngo, 2023. "Market Reaction to Delisting Announcements in Frontier Markets: Evidence from the Vietnam Stock Market," Risks, MDPI, vol. 11(11), pages 1-14, November.
    • Handle: RePEc:gam:jrisks:v:11:y:2023:i:11:p:201-:d:1281501
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-9091/11/11/201/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-9091/11/11/201/
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jrisks:v:11:y:2023:i:11:p:201-:d:1281501. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.