Strategies on initial public offering of company equity at stock exchanges in imperfect highly volatile global capital markets with induced nonlinearities
This research considers the strategies on the initial public offering of company equity at the stock exchanges in the imperfect highly volatile global capital markets with the nonlinearities. We provide the IPO definition and compare the initial listing requirements on the various markets. We analyze the IPO techniques: the fixed-price offerings, auctions, book-building. We focus on the IPO initial underpricing, long-run performance and after market liquidity problems. 1. We propose that the information absorption by the investors occurs in the evolving learning process about the company’s value, taking to the consideration the fundamental purpose of investing and the responsibilities of investors. 2. We think that the information absorption capacity by the investors on the IPOs impacts the investor’s investment decisions and serves as a pre-determinant for the successful IPO deal completion. We propose the Ledenyov theory on the origins of the IPO underpricing and long term underperformance effects, which states that the IPO underpricing and long term underperformance can be explained by the changing information absorption capacity by the investors on the IPO value. 3. We think that the IPO winning virtuous investment strategies can only be selected by the investors with the highest information absorption capacity through the decision making process on the IPO investment choices at the selected stock exchange in the imperfect highly volatile global capital markets with the nonlinearities; applying the econophysical econometrical analysis with the use of the inductive, deductive and abductive logics in the frames of the strategic choice structuring process, that is the winning through the distinctive choices process.
Year of publication: |
2014-02-18
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Authors: | Ledenyov, Dimitri O. ; Ledenyov, Viktor O. |
Institutions: | Volkswirtschaftliche Fakultät, Ludwig-Maximilians-Universität München |
Subject: | Information absorption | initial public offering (IPO) | listing requirements | mechanism choices | direct costs | underwriting | audit fees | selling commission | legal expenses | indirect costs | certification | grading | market cycles | valuation | underpricing | overpricing | long term under-performance | long term over-performance | investment strategy | inductive logics | deductive logics | abductive logics | strategic choice structuring process | nonlinearities | econophysics | econometrics | stock exchanges | imperfect highly volatile global capital markets |
Saved in:
freely available
Extent: | application/pdf |
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Type of publication: | Book / Working Paper |
Classification: | C5 - Econometric Modeling ; c58 ; C87 - Econometric Software ; D81 - Criteria for Decision-Making under Risk and Uncertainty ; D82 - Asymmetric and Private Information ; D83 - Search, Learning, Information and Knowledge ; G1 - General Financial Markets ; G11 - Portfolio Choice ; G12 - Asset Pricing ; G17 - Financial Forecasting ; G24 - Investment Banking; Venture Capital; Brokerage ; G32 - Financing Policy; Capital and Ownership Structure ; G34 - Mergers; Acquisitions; Restructuring; Corporate Governance ; L1 - Market Structure, Firm Strategy, and Market Performance ; L21 - Business Objectives of the Firm ; L22 - Firm Organization and Market Structure: Markets vs. Hierarchies; Vertical Integration ; L25 - Firm Size and Performance ; M4 - Accounting and Auditing |
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Persistent link: https://www.econbiz.de/10011258000