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| Author: | Drobetz, W. Kammermann, M. Wälchli, U. |
| Title: | Long-run performance of initial public offerings: The evidence for Switzerland |
| Journal: | Schmalenbach Business Review
2005 : JUL, VOL. 57:3, p. 253-275 |
| Index terms: | stock markets market efficiency performance measurement initial public offerings pricing Switzerland |
| Language: | eng |
| Abstract: | This study estimates the underpricing and long-run performance (hereafter as: l-r-perf.) of Swiss initial public offerings (IPOs) from 1983 to 2000. To examine the l-r-perf. of Swiss IPOs, computed are buy-and-hold abnormal returns, skew-ness-adjusted wealth ratios, and cumulative abnormal returns using 120 months of secondary market returns. In contrast to previous findings for U.S. and Germany, no strong evidence is found for a distinct IPO effect. Attributed is long-run underperformance to the fact that IPO firms tend to be small firms. It virtually vanishes when using a small capitalization index as a benchmark. Despite distinct economic implications and statistical properties, the basic results are similar for all performance measures applied. |
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