Preference for bid time in hybrid auctioned IPOs: Evidence from China

Jingbin He, Xinru Ma and Jingchi Liao

The North American Journal of Economics and Finance, 2021, vol. 57, issue C

Abstract: Using comprehensive bidding data of 783 Chinese IPOs from June 2009 to November 2012, we investigate institutions’ preference for bid time in hybrid auctions. We find that (1) earlier bids are associated with higher pricing errors, which is more pronounced in IPOs with greater uncertainty; (2) the bid prices of earlier bids tend to be aggressively high; (3) earlier bids are associated with fewer bid shares and allocations; (4) bidders submitting earlier bids (hereafter, earlier bidders) have inferior profits; and (5) earlier bidders show persistence in bid time. Overall, the empirical results remain robust after controlling for unobserved bidder-underwriter relationships and indicate that earlier bidders tend to be less informed. Our findings reveal and highlight the effect of bid time on identifying informative bids in hybrid auctions.

Keywords: IPO; Hybrid auction; Bid time; Information (search for similar items in EconPapers)
JEL-codes: G14 G24 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1062940821000267
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecofin:v:57:y:2021:i:c:s1062940821000267

DOI: 10.1016/j.najef.2021.101389

Access Statistics for this article

The North American Journal of Economics and Finance is currently edited by Hamid Beladi

More articles in The North American Journal of Economics and Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().