Foreign listing pricing effects. The case of emerging economies

Joanna Adamska-Mieruszewska () and Urszula Mrzygłód ()
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Joanna Adamska-Mieruszewska: University of Gdansk, Faculty of Economics
Urszula Mrzygłód: University of Gdansk, Faculty of Economics

Bank i Kredyt, 2020, vol. 51, issue 4, 367-382

Abstract: Together with global financial integration processes, companies from emerging markets gained access to foreign stock exchanges also through the issue of the depositary receipts. The aim of this paper is to examine the price reaction on the domestic stock exchange in response to cross-listing on foreign stock markets. To do so, we employ the event study method and investigate the pricing effects of 272 depositary receipts listings of companies from 12 emerging economies. Based on the non- -parametric tests, we found that issuing depositary receipts generates statistically significant negative abnormal returns on the domestic stock market two days before the listing day. On the contrary, the results of the parametric test revealed negative but non-significant abnormal returns during the pre--listing period. We interpret our findings as evidence of non-positive market reaction and decreasing significance of the cross-listing decisions for the domestic shareholders.

Keywords: cross-listing; emerging economies; event study (search for similar items in EconPapers)
JEL-codes: F30 G15 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:nbp:nbpbik:v:51:y:2020:i:4:p:367-382

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