IDEAS home Printed from https://ideas.repec.org/a/ijb/journl/v9y2010i1p57-76.html
   My bibliography  Save this article

On IPO Market Anomalies through the Emerging Stock Market in Taiwan

Author

Listed:
  • Yi-Shuan Chen

    (Ph.D. Program in Business, Feng Chia University, Taiwan and Department of Banking and Insurance, National Taichung Institute of Technology, Taiwan)

  • Shin-Herng Michelle Chu

    (Department of Finance, Feng Chia University, Taiwan)

Abstract

This study investigates the long-term performance of initial public offering (IPO) firms in Taiwan since it established a pre-IPO market, the Emerging Stock Market (ESM), starting in 2002. The analytical results indicate that IPO firms in Taiwan suffer long-term post-issue deterioration in operating performance, and the difference in deterioration between ESM and direct listing firms is more significant for the Taiwan Stock Exchange than for the Gre Tai Securities Market. This phenomenon can be explained by the overly-optimistic-market-expectations and the window-of-opportunity hypotheses; however, managerial ownership control variables are not statistically significant.

Suggested Citation

  • Yi-Shuan Chen & Shin-Herng Michelle Chu, 2010. "On IPO Market Anomalies through the Emerging Stock Market in Taiwan," International Journal of Business and Economics, College of Business and College of Finance, Feng Chia University, Taichung, Taiwan, vol. 9(1), pages 57-76, April.
  • Handle: RePEc:ijb:journl:v:9:y:2010:i:1:p:57-76
    as

    Download full text from publisher

    File URL: http://www.ijbe.org/table%20of%20content/pdf/vol9-1/vol9-1-05.pdf
    Download Restriction: no

    File URL: http://www.ijbe.org/table%20of%20content/abstract/Vol.9/No.1/05.htm
    Download Restriction: no

    References listed on IDEAS

    as
    1. Chan, Kalok & Wang, Junbo & Wei, K. C. John, 2004. "Underpricing and long-term performance of IPOs in China," Journal of Corporate Finance, Elsevier, vol. 10(3), pages 409-430, June.
    2. Loughran, Tim & Ritter, Jay R, 1997. " The Operating Performance of Firms Conducting Seasoned Equity Offerings," Journal of Finance, American Finance Association, vol. 52(5), pages 1823-1850, December.
    3. Kutsuna, Kenji & Okamura, Hideo & Cowling, Marc, 2002. "Ownership structure pre- and post-IPOs and the operating performance of JASDAQ companies," Pacific-Basin Finance Journal, Elsevier, vol. 10(2), pages 163-181, April.
    4. Benveniste, Lawrence M. & Spindt, Paul A., 1989. "How investment bankers determine the offer price and allocation of new issues," Journal of Financial Economics, Elsevier, vol. 24(2), pages 343-361.
    5. Nohel, Tom & Tarhan, Vefa, 1998. "Share repurchases and firm performance:: new evidence on the agency costs of free cash flow," Journal of Financial Economics, Elsevier, vol. 49(2), pages 187-222, August.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    initial public offering; operating performance; emerging stock market;

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies

    Statistics

    Access and download statistics

    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:ijb:journl:v:9:y:2010:i:1:p:57-76. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Yi-Ju Su). General contact details of provider: http://edirc.repec.org/data/cbfcutw.html .

    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.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.