Securities Market Design and Stock Market Segments for Small Company Shares: Empirical Evidence from Initial Public Offerings in Germany

2016 ◽  
Vol 28 (6) ◽  
Author(s):  
Wolfgang Bessler ◽  
Colin Schneck
Keyword(s):  
Stock Market ◽  
Initial Public Offerings ◽  
Securities Market ◽  
Market Segment ◽  
Small Companies ◽  
Small Company ◽  
Market Segments ◽  
Public Offerings ◽  
Neuer Markt ◽  
General Standard

AbstractIn 1997 the “Neuer Markt” was opened as a stock market segment for small companies in Germany and initially performed well by attracting 329 initial public offerings (IPOs). It was closed in 2003 and listed companies were forced to transfer to either the higher ranked “Prime Standard” or to the lower ranked “General Standard”. We analyze the valuation effects of these “new economy” IPOs and whether the segment transfer decision could have been predicted with information that was available at the time of the IPO. Companies are more likely to change to the higher ranked Prime Standard if they are larger, more profitable, and have more growth opportunities. Firms that switch to the lower ranked General Standard improved the subsequent performance, suggesting that they are now traded on a market segment that better matches the firm characteristics with the listing requirements. Hence, designing different market segments that fit best with the heterogeneous characteristics of small companies are one avenue for convincing more companies to go public. Insight from this study may help with regard to establishing efficient and successful securities market segments for small company shares, which currently is intensively debated in many countries. Interestingly, Deutsche Börse announced another re-segmentation on November 21, 2016. This includes the closing of the Entry Standard and the opening of a new market segment for SMEs and growth companies on March 1, 2017.

Small-Company Initial Public Offerings: The Impact of SEC Registration Form S—18

1986 ◽  
Vol 1 (3) ◽  
pp. 206-221
Author(s):  
James G. Manegold
Keyword(s):  
Initial Public Offerings ◽  
Public Capital ◽  
Securities Market ◽  
Small Companies ◽  
Small Company ◽  
Registration Form ◽  
Additional Risk ◽  
Public Offerings ◽  
Start Up ◽  
The Impact

This paper reports on the impact of SEC registration Form S–18 on the new-issues securities market. Form S–18 was intended as an easier, faster, and less costly alternative for small companies to raise public capital. The findings indicate that Form S–18 offerings were slightly less costly and were processed faster than Form S–1 offerings. They also suggest that Form S–18 has helped smaller, start-up companies go public, that potential investors may face additional risk when purchasing Form S–18 offerings, and that underwriters were sensitive to the added risk.

scholarly journals Improvement of Tax Regulation Arrangements for the Russian Stock Market

2020 ◽  
Vol 8 (16) ◽  
pp. 556-570
Author(s):  
Andrei V Koren ◽  
Tatyana E Danilovskikh ◽  
Artem A. Pustovarov
Keyword(s):  
Stock Market ◽  
Income Tax ◽  
Securities Market ◽  
Tax Base ◽  
Public Offerings ◽  
Tax Legislation ◽  
The Status ◽  
Tax Benefits ◽  
Russian Stock Market ◽  
Financial Transactions

The paper discusses various options for taxation of transactions with securities issued by Russian companies. The study aims to solve the problem of low investor activity in the Russian stock market by transforming the current tax legislation. An assessment of the factors restraining the development of the primary public offerings market is given. The problems of the existing methodology for the formation of the tax base when calculating income tax and personal income tax on transactions with exchange-traded financial assets are analysed. A methodology for providing tax benefits and tax incentives for investors is proposed. An assessment of the effectiveness of tax benefits using an individual investment account is given. A comparative analysis of the amount of taxes paid is carried out depending on the status of an investor and the type of securities. A detailed description of the methods for calculating taxes on stocks, bonds and futures is given. The results of the study consist in substantiating theoretical and practical provisions that allow us to develop an effective mechanism for taxing financial transactions in the securities market. The need is theoretically substantiated and the significance of state support in the stock market for citizens of the Russian Federation is determined. Mechanisms are proposed for cancelling separate accounting for several types of tax bases. The main problems are found and ways to improve the mechanism of taxation of transactions made on the Russian stock market are developed.

The stock market as a source of capital: Some lessons from initial public offerings in Italy

1996 ◽  
Vol 40 (3-5) ◽  
pp. 1057-1069 ◽  
Author(s):  
Marco Pagano ◽  
Fabio Panetta ◽  
Luigi Zingales
Keyword(s):  
Stock Market ◽  
Initial Public Offerings ◽  
Public Offerings

scholarly journals Pricing And Long-Run Performance Of The Venture-Backed And Nonventure-Backed IPOS

2011 ◽  
Vol 2 (6) ◽  
Author(s):  
Arvin Ghosh
Keyword(s):  
Stock Market ◽  
Venture Capital ◽  
Initial Public Offerings ◽  
Cash Flows ◽  
Venture Capitalists ◽  
Regression Equations ◽  
Public Offerings ◽  
Long Run ◽  
First Time ◽  
Prevalent Form

Initial Public Offerings (IPOs) were the most prevalent form to raise capital by firms wanting to go public during the last decade (1990 2000) in the United State. There were thousands of firms that went public for the first time, mostly in the technology-heavy NASDAQ stock market. Along with the regular IPOs came the IPOs backed by venture capitalists, who specialize in financing promising startup companies and bringing them public. As one-third of the IPOs were backed by venture capitalists during 1990 2000, our purpose here is to examine the pricing and long-run performance of the venture-backed and nonventure-backed IPOs that were issued in the NYSE and NASDAQ stock market during the period covered by our study. We have found, among others, that the venture-backed IPOs performed much better as compared to the nonventure-backed IPOs. The returns of the former were consistently higher than the latter during 1900 2000. Also, the price returns as well as the operating ratios and the growth of cash flows, were higher both in the NYSE and NASDAQ market. The regression equations also confirmed closer association with the independent variables belonging to the IPOs backed by venture capital than the non-venture capital.

Initial Public Offerings in Germany between 1997 and 2015

2018 ◽  
pp. 558-572
Author(s):  
Andreas Oehler ◽  
Tim Herberger ◽  
Matthias Horn
Keyword(s):  
Stock Market ◽  
Initial Public Offerings ◽  
Market Liquidity ◽  
Subprime Crisis ◽  
Market Returns ◽  
Stock Market Returns ◽  
Public Offerings ◽  
German Stock ◽  
German Stock Market ◽  
Dot Com

This chapter focuses on the German IPO market from 1997 to 2015. More specifically, it provides a descriptive overview of the IPO activities in Germany in the last two decades, and analyzes the IPO market’s dependence on the yearly return and turnover of the German stock market. It shows that most IPOs and highest volumes were observed during the dot-com bubble phase (1997–2000) and that the German IPO market’s liquidity shows a stable development in the last years after the subprime crisis. The results of the regression analyses show that the IPO market activity strongly depends on the overall stock market turnover. But the stock market returns play a subordinated role for the IPO market liquidity in Germany.

scholarly journals Speculative Prices and Popular Models

1990 ◽  
Vol 4 (2) ◽  
pp. 55-65 ◽  
Author(s):  
Robert J Shiller
Keyword(s):  
Stock Market ◽  
Initial Public Offerings ◽  
Rational Expectations ◽  
Survey Methods ◽  
Common Stock ◽  
Stock Market Crash ◽  
Public Offerings ◽  
True Model ◽  
Data Collection Effort ◽  
The U.S

The key idea of rational expectations models is to assume that people know (or behave as if they know) the true model that describes the economy. However, popular economic models (the models that are used by the broad masses of economic actors to form their expectations) are obviously not the same as those held by economists. This paper reports on data collection effort on popular models, using questionnaire survey methods, with the purpose of understanding speculative markets. I will report here on my research to understand the U.S. stock market crash of October 1987; research Fumiko Konya, Yoshiro Tsutsui, and I undertook to understand the Japanese stock market crash of October 1987; research Karl Case and I undertook to understand recent real estate booms; and research John Pound and I undertook to understand the periodic “hot” markets for initial public offerings (IPO's) of common stock.

Initial and After-market Performance of SME IPOs in India

2017 ◽  
Vol 18 (6) ◽  
pp. 1536-1551 ◽  
Author(s):  
Sanjay Dhamija ◽  
Ravinder Kumar Arora
Keyword(s):  
Multivariate Analysis ◽  
Stock Market ◽  
Initial Public Offerings ◽  
Stock Exchange ◽  
Small And Medium Enterprises ◽  
Market Performance ◽  
Stock Exchanges ◽  
Public Offerings ◽  
Low Level ◽  
Medium Enterprises

This article examines the initial and after-market performance of the initial public offerings (IPOs) listed on the recently launched platform for small and medium enterprises (SMEs) by the Bombay Stock Exchange (BSE), Mumbai and the National Stock Exchange (NSE). The study does find evidence of underpricing of IPOs by SMEs in line with other studies internationally. However, the level of underpricing is found to be lower than that of IPOs listed on the main board stock exchanges in India, reported by earlier studies. This may be partially due to the fact that the SME platform is at an infancy stage and has failed to attract investors’ fancy. This is reflected in a low level of oversubscription of SME IPOs at 1.35 times on average. The multivariate analysis identifies the type of offer, size of issue, promoter holding, extent of oversubscription, lead manager prestige and the stock exchange of listing as the key determinants of underpricing of SME IPOs. Post listing, these IPOs have significantly out-performed the benchmark index. The finding is inconsistent with the results of other studies on the main board exchanges where the IPOs, in general, are found to underperform the markets over a significant period of time post listing. This may partly be attributed to thin trading in these stocks and, therefore, to their lower level of liquidity. The findings have significant implications for stock-market regulators, issuers and investors.

scholarly journals Board governance on dividend initiation by initial public offerings: Evidence from The Malaysian stock market

2020 ◽  
Vol 8 (1) ◽  
pp. 1761241
Author(s):  
Nizar Dwaikat ◽  
Abdelbaset Queiri ◽  
Ihab Sameer Qubbaj ◽  
Caroline Elliott
Keyword(s):  
Stock Market ◽  
Initial Public Offerings ◽  
Board Governance ◽  
Public Offerings
Sign in / Sign up

Export Citation Format

Share Document