Does increased disclosure of intangible assets enhance liquidity around new equity offerings?

Manel Labidi and Jean-François Gajewski ()
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Manel Labidi: IREGE - Institut de Recherche en Gestion et en Economie - USMB [Université de Savoie] [Université de Chambéry] - Université Savoie Mont Blanc
Jean-François Gajewski: MAGELLAN - Laboratoire de Recherche Magellan - UJML - Université Jean Moulin - Lyon 3 - Université de Lyon - Institut d'Administration des Entreprises (IAE) - Lyon

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Abstract: The objective of this paper is to analyze how firms can enhance stock market liquidity around new equity offerings by increasing the level of disclosure on their intangible assets. Using a disclosure index consisting of 53 items, we show that French issuers disclose insufficient information about their intangible assets. We use measures of liquidity such as bid-ask spread, market depth, and trading volume to provide evidence that increased intangible asset information disclosure by new equity issuers improves secondary market liquidity immediately following the issue. These results provide new evidence that when raising funds, issuers can enhance stock liquidity by giving investors more information about intangible assets.

Keywords: New equity issues; Liquidity; Intangible assets; Voluntary disclosure (search for similar items in EconPapers)
Date: 2019-04
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Citations: View citations in EconPapers (6)

Published in Research in International Business and Finance, 2019, 48, pp.426-437. ⟨10.1016/j.ribaf.2019.01.009⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02050598

DOI: 10.1016/j.ribaf.2019.01.009

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