Pricing initial public offerings: Further evidence from Germany

摘要: Abstract In a recent article in this Review, Wasserfallen and Wittleder (Pricing initial public offerings: Evidence from Germany, European Economic Review 38, 1505–1517, 1994) [WW] provide evidence of the well-known underpricing phenomenon for 92 German IPOs coming to market 1961–1987. Using larger sample 189 firms 1970–1993, paper (i) reassesses on after choosing different risk proxy avoid potential endogeneity problems, (ii) provides long-run IPO performance. A number new results emerge. Stock returns, macroeconomic climate, insider retention rates, inverse offer size all affect positively. Over longer horizons are poor investments, losing more than twelve percent over their first three years trading relative (exclusive return). Negative performance is heavily concentrated end WW's sampling period, post-1987 cohort.