Title page for etd-0723113-111252


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URN etd-0723113-111252
Author Chih-Hsuan Wu
Author's Email Address No Public.
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Department Business Management
Year 2012
Semester 2
Degree Master
Type of Document
Language zh-TW.Big5 Chinese
Title Long-Term and Short-Term Performance of IPOs in Taiwan
Date of Defense 2013-07-30
Page Count 54
Keyword
  • Initial Public Offering
  • Long-run Perforamnce
  • Initial Return
  • Abstract Numbers studies such as Ritter (1991), Tsao (2012) have documented two phenomena in the return of initial public offerings (IPO) of common stock: (1) the short term abnormal return and (2) the long term reversal return.If we buy IPO stocks after IPO, is it possible to have positive return? If we use the latest financial report information, could we discover some factors having important influence on IPO return? This paper studies on (1) the short term and long term return of IPO in Taiwan (2) how to buy IPO stocks after IPO and (3) find the factors effect on IPO returns.
    Using a sample of 554 IPOs that went public in Taiwan in the 2000-2010 periods, we get the following results:
    (1.) Measured from the offering price to the market price at the end of the first day of trading for IPOs issued after November 15 2005 and from the offering price to the first non-ceiling price for IPOs issued before November 15 2005,IPOs produce an average initial return that has been estimated at 30.01% in Taiwan。
    (2.) For the long term return, holding one year return for IPOs declines and more than half IPOs are negative return. The holding two year return for IPOs is positive. But if we remove some abnormal IPOs, the holding two year return for IPOs becomes worse.
    (3.) IF we buy IPOs one month later after IPO and hold one year, we find that buying the “loser” with holding return negative for the first month performs well than the “winner” with holding return positive for the first month, nevertheless, holding just one month the return is negative whether “winner” nor “loser”.
    (4.) Most financial report ratios ex: current ratio, debt ratio. etc. have no influence on IPO return. The subscription multiplier has significant positive relationship with the initial return reflecting that the stronger demand it has, the higher initial IPO return it becomes.
    (5.) P/B ratio has negative relation with short term and long term return. In this paper we use the offering price as price. This means the offering price is overvalued by IPO investors.
    Advisory Committee
  • Lanfeng Kao - chair
  • Lu, Cheng-Shou - co-chair
  • AN-LIN CHEN - advisor
  • Files
  • etd-0723113-111252.pdf
  • Indicate in-campus at 99 year and off-campus access at 99 year.
    Date of Submission 2013-08-23

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