Fixed-price, auction, and bookbuilding IPOs: Empirical evidence in Taiwan

Hsin-Yi Huang, Min-Hsien Chiang, Jia-Hui Lin and Yun Lin

Finance Research Letters, 2017, vol. 22, issue C, 11-19

Abstract: This study investigates the effects of three initial public offering (IPO) methods-namely, fixed-price, auction, and bookbuilding, all of which have been brought into practice in Taiwan-on post-IPO performance and the trading behavior of institutional investors. Of these three methods, the empirical results show that bookbuilding IPOs exhibit significantly higher initial returns and institutional ownership of stock offerings, and that auction IPOs have higher long-run returns. The price effect of institutional herding and flipping behavior with respect to fixed-price IPOs significantly erode long-run IPO performance.

Keywords: Initial public offering (IPO); Bookbuilding; Auction; Institutional investment (search for similar items in EconPapers)
JEL-codes: G12 G14 G23 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:22:y:2017:i:c:p:11-19

DOI: 10.1016/j.frl.2017.04.002

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