Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level

A private company going public for the first time by issuing their shares to the public is called Initial public offering (IPO). It is used as means to raise fund for expansion and other investment. The IPOs' initial return is the difference between the offer price of the company‟s shares and t...

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Main Author:	Ahmad Zulaini, Mohammad Fairuz
Format:	Thesis
Published:	2014
Subjects:	HG Finance
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id	my-mmu-ep.5663
record_format	uketd_dc
spelling	my-mmu-ep.56632015-06-30T04:18:15Z Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level 2014-06 Ahmad Zulaini, Mohammad Fairuz HG Finance HG4001-4285 Finance management. Business finance. A private company going public for the first time by issuing their shares to the public is called Initial public offering (IPO). It is used as means to raise fund for expansion and other investment. The IPOs' initial return is the difference between the offer price of the company‟s shares and the first day closing price. There are many factors that can influence the IPOs' initial return such as market condition, underwriters' reputation, auditors' reputation and etc. Apart from this, it is evidenced by previous literature that institutional arrangements of a country also have significant influence on IPOs' initial return such as the investors' protection of country, level of corruption in a country, legal origin and many others. An investor regulation hypothesis has been suggested by La Porta (1998), and a huge literature following them, claiming that investor protection regulation influence capital markets. Hence, this study analyses the influence of investors' protection, corruption level, and legal origin on the IPOs' initial return for 28 selected OECD countries with sample size 4172 public listed companies from year 2005 to 2010. It is found that investors' protection and corruption level of a country do have significant positive relationship with the IPOs' initial return. In contrast to that legal origin of a country shows a negative relationship towards the IPOs' initial return suggesting stronger legal framework will decrease the IPOs' initial return. The finding of this study can be used as reference for minority investors and companies that are going for IPO. This study can also be used as an insight for future studies relating to IPOs' initial return and the institutional arrangements of a country. 2014-06 Thesis http://shdl.mmu.edu.my/5663/ http://library.mmu.edu.my/diglib/onlinedb/dig_lib.php masters Multimedia University Graduate School of Management
institution	Multimedia University
collection	MMU Institutional Repository
topic	HG Finance HG Finance
spellingShingle	HG Finance HG Finance Ahmad Zulaini, Mohammad Fairuz Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level
description	A private company going public for the first time by issuing their shares to the public is called Initial public offering (IPO). It is used as means to raise fund for expansion and other investment. The IPOs' initial return is the difference between the offer price of the company‟s shares and the first day closing price. There are many factors that can influence the IPOs' initial return such as market condition, underwriters' reputation, auditors' reputation and etc. Apart from this, it is evidenced by previous literature that institutional arrangements of a country also have significant influence on IPOs' initial return such as the investors' protection of country, level of corruption in a country, legal origin and many others. An investor regulation hypothesis has been suggested by La Porta (1998), and a huge literature following them, claiming that investor protection regulation influence capital markets. Hence, this study analyses the influence of investors' protection, corruption level, and legal origin on the IPOs' initial return for 28 selected OECD countries with sample size 4172 public listed companies from year 2005 to 2010. It is found that investors' protection and corruption level of a country do have significant positive relationship with the IPOs' initial return. In contrast to that legal origin of a country shows a negative relationship towards the IPOs' initial return suggesting stronger legal framework will decrease the IPOs' initial return. The finding of this study can be used as reference for minority investors and companies that are going for IPO. This study can also be used as an insight for future studies relating to IPOs' initial return and the institutional arrangements of a country.
format	Thesis
qualification_level	Master's degree
author	Ahmad Zulaini, Mohammad Fairuz
author_facet	Ahmad Zulaini, Mohammad Fairuz
author_sort	Ahmad Zulaini, Mohammad Fairuz
title	Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level
title_short	Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level
title_full	Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level
title_fullStr	Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level
title_full_unstemmed	Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level
title_sort	initial public offerings (ipos) initial returns: some evidence from investors’ protection legal origin and corruption level
granting_institution	Multimedia University
granting_department	Graduate School of Management
publishDate	2014
_version_	1747829582646476800

Initial Public Offerings (IPOs) initial returns: Some evidence from investors’ protection legal origin and corruption level

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