• ISSN: 2301-3567
    • Frequency: Quarterly (2013-2014); Monthly (2015-2017); Quarterly (Since 2018)
    • DOI: 10.18178/JOEBM
    • Editor-in-Chief: Prof. Eunjin Hwang
    • Executive Editor: Ms. Mia Hu
    • Abstracting/ Indexing:  Electronic Journals Library, Ulrich's Periodicals Directory, MESLibrary, Google Scholar, and Crossref.
    • E-mail: joebm@ejournal.net
JOEBM 2018 Vol.6(4): 150-154 ISSN: 2301-3567
DOI: 10.18178/joebm.2018.6.4.565

What Happened to the Investors of South Asian Countries While Investing in the Newly Listed Firms: A New Approach?

Muhammad Khalid Sohail and Rehana Farhat
Abstract— The study probes the comparable firm adjusted performance of newly listed firms in the south Asian countries, by using the new approach. The results show that the investors of south Asian countries can earn 73.46% returns on the first day of trading of newly listed firms. The market adjusted underpricing is observed to be 66.52% for the full sample of 519 IPOs. The comparable firm adjusted underpricing remains at 80.21% for the reduced sample of 331 IPOs, however, market adjusted underpricing remains a little bit lower (78.65%) as compared with the comparable firm adjusted underpricing. The level of underpricing is observed to be significantly higher in Bangladesh as compared with the other south Asian countries. India and Sri Lanka show the lower level of underpricing due to its book building mechanism.

Index Terms— South Asian, comparable firms, underpricing, tracking error.

Muhammad Khalid Sohail is with COMSATS University Islamabad, Pakistan (e-mail: khalid_sohail@comsats.edu.pk). Rehana Farhat is with PMAS, Arid Agriculture University, Rawalpindi, Pakistan (e-mail: ranikhalid7@gamil.com).

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Cite: Muhammad Khalid Sohail and Rehana Farhat, "What Happened to the Investors of South Asian Countries While Investing in the Newly Listed Firms: A New Approach?," Journal of Economics, Business and Management vol. 6, no.4, pp. 150-154, 2018.

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