IPOs, clustering, indirect learning and filing independently

Hugh M.J. Colaco; Chinmoy Ghosh; John Knopf; John Teall

doi:10.1016/j.jbankfin.2009.03.016

IPOs, clustering, indirect learning and filing independently

Hugh M.J. Colaco, Chinmoy Ghosh, John Knopf, John Teall

Research output: Contribution to journal › Article › peer-review

Abstract

IPO underpricing has been attributed to valuation uncertainty, which can be at least partially resolved by the indirect learning associated with IPO clustering [Benveniste, L.M., Ljungqvist, A., Wilhelm, W.J., Yu, X.Y., 2003. Evidence of information spillovers in the production of investment banking services. Journal of Finance 58, 577–608]. We examine why firms might choose not to issue their IPOs contemporaneously with clusters of similar firms, forgoing opportunities to learn from their peers. We find that the willingness to file an IPO without the benefit of indirect learning from peer firm IPOs is directly related to insiders’ needs for portfolio diversification and the firm’s need to raise capital.

Original language	English
Pages (from-to)	2070-2079
Number of pages	10
Journal	Journal of Banking and Finance
Volume	33
Issue number	11
Early online date	13 Jun 2009
DOIs	https://doi.org/10.1016/j.jbankfin.2009.03.016
Publication status	Published - Nov 2009

Keywords

IPO
underpricing
underwriter
learning

Access to Document

10.1016/j.jbankfin.2009.03.016

Cite this

@article{03b0a702ed8340048cdf4d678a7afb77,

title = "IPOs, clustering, indirect learning and filing independently",

abstract = "IPO underpricing has been attributed to valuation uncertainty, which can be at least partially resolved by the indirect learning associated with IPO clustering [Benveniste, L.M., Ljungqvist, A., Wilhelm, W.J., Yu, X.Y., 2003. Evidence of information spillovers in the production of investment banking services. Journal of Finance 58, 577–608]. We examine why firms might choose not to issue their IPOs contemporaneously with clusters of similar firms, forgoing opportunities to learn from their peers. We find that the willingness to file an IPO without the benefit of indirect learning from peer firm IPOs is directly related to insiders{\textquoteright} needs for portfolio diversification and the firm{\textquoteright}s need to raise capital.",

keywords = "IPO, underpricing, underwriter, learning",

author = "Colaco, {Hugh M.J.} and Chinmoy Ghosh and John Knopf and John Teall",

year = "2009",

month = nov,

doi = "10.1016/j.jbankfin.2009.03.016",

language = "English",

volume = "33",

pages = "2070--2079",

journal = "Journal of Banking and Finance",

issn = "0378-4266",

publisher = "Elsevier",

number = "11",

}

TY - JOUR

T1 - IPOs, clustering, indirect learning and filing independently

AU - Colaco, Hugh M.J.

AU - Ghosh, Chinmoy

AU - Knopf, John

AU - Teall, John

PY - 2009/11

Y1 - 2009/11

N2 - IPO underpricing has been attributed to valuation uncertainty, which can be at least partially resolved by the indirect learning associated with IPO clustering [Benveniste, L.M., Ljungqvist, A., Wilhelm, W.J., Yu, X.Y., 2003. Evidence of information spillovers in the production of investment banking services. Journal of Finance 58, 577–608]. We examine why firms might choose not to issue their IPOs contemporaneously with clusters of similar firms, forgoing opportunities to learn from their peers. We find that the willingness to file an IPO without the benefit of indirect learning from peer firm IPOs is directly related to insiders’ needs for portfolio diversification and the firm’s need to raise capital.

AB - IPO underpricing has been attributed to valuation uncertainty, which can be at least partially resolved by the indirect learning associated with IPO clustering [Benveniste, L.M., Ljungqvist, A., Wilhelm, W.J., Yu, X.Y., 2003. Evidence of information spillovers in the production of investment banking services. Journal of Finance 58, 577–608]. We examine why firms might choose not to issue their IPOs contemporaneously with clusters of similar firms, forgoing opportunities to learn from their peers. We find that the willingness to file an IPO without the benefit of indirect learning from peer firm IPOs is directly related to insiders’ needs for portfolio diversification and the firm’s need to raise capital.

KW - IPO

KW - underpricing

KW - underwriter

KW - learning

UR - http://www.scopus.com/inward/record.url?scp=70249112563&partnerID=8YFLogxK

U2 - 10.1016/j.jbankfin.2009.03.016

DO - 10.1016/j.jbankfin.2009.03.016

M3 - Article

VL - 33

SP - 2070

EP - 2079

JO - Journal of Banking and Finance

JF - Journal of Banking and Finance

SN - 0378-4266

IS - 11

ER -

IPOs, clustering, indirect learning and filing independently

Abstract

Keywords

Access to Document

Other files and links

Fingerprint

Cite this