Post-listing performance and private sector regulation: The experience of London's Alternative Investment Market

Joseph Gerakos, Mark Lang and Mark Maffett

Journal of Accounting and Economics, 2013, vol. 56, issue 2, 189-215

Abstract: We investigate the experience of companies listing and raising capital on the AIM, which is privately regulated and relies on Nominated Advisors who compete for listings and provide regulatory oversight. AIM firms underperform newly listed firms on traditionally regulated exchanges based on post-listing returns and failure rates, comparable to firms listing on the unregulated US Pink Sheets, and exhibit abnormally high pre-listing accruals and post-listing reversals. “High quality” auditors and Nomads partially mitigate underperformance, suggesting that AIM firms have limited ability to bond through more stringent oversight. Underperformance is particularly pronounced for firms with higher proportions of retail investors.

Keywords: Securities regulation; Post-IPO performance; International accounting (search for similar items in EconPapers)
JEL-codes: F30 G18 G24 G32 G38 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (41)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jaecon:v:56:y:2013:i:2:p:189-215

DOI: 10.1016/j.jacceco.2013.08.004

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