Does initial public offering have influence on liquidity and trading activity?
- Acedo Ramírez, Miguel Ángel
- Ruiz Cabestre, Francisco Javier
- Santamaría Aquilué, Rafael
- Silva, Emilio José de Castro (coord.)
- Díaz de Castro, Francisco José (coord.)
Publisher: Asociación Española de Dirección y Economía de la Empresa (AEDEM)
ISBN: 978-84-691-5667-4
Year of publication: 2008
Pages: 84-98
Congress: Asociación Europea de Dirección y Economía de Empresa. International Conference AEDEM (17. 2008. Salvador de Bahía)
Type: Conference paper
Abstract
This study examines the relationship between the characteristics that define initial public offerings (IPOs) and the liquidity and trading activity of stocks outstanding after the execution of these operations. We argue that higher relative size, retail composition and underpricing of the offerings higher post-listing liquidity and trading activity. Using a sample of Spanish IPOs, the results reveal that the liquidity and the trading activity can be explained by the characteristics that define IPOs. In addition these results remain robust after excluding the market effect.