Birds of a Feather Flock Together: First Time Investors and IPOs
2015 (English)In: Proceedings of 10th Annual London Business Research Conference / [ed] Md. Mahbubul Hoque Bhuiyan, 2015Conference paper, Abstract (Refereed)
Initial public offerings (IPOs) are firms entering the stock market, through offering shares to be publicly traded in the stock market for the first time. Similarly, first time stock investors (rookies) enter the stock market through buying shares. Investment decisions have been interesting to study both for academics and practitioners for decades. In this paper knowledge on IPOs and investment decisions of rookies are brought together. Moreover, rookies who chose to invest in initial public offerings (IPOs) as their entry to the stock market. The study is based on a hand-collected dataset of IPOs and of an ownership registry of all Swedish shareholders. The study shows that IPOs can serve as a first time investment for rookies, however, preferred together with other shares. Rookies investing in IPOs hold larger portfolios and have larger income than other rookies. IPOs attract rookies to larger extent than non-rookies. Thereby, through IPOs the stock market receives not only new firms but also new investors.
Place, publisher, year, edition, pages
Finance, Behavioral Finance
Research subject Business Studies
IdentifiersURN: urn:nbn:se:uu:diva-260583ISBN: 978-1-922069-81-8OAI: oai:DiVA.org:uu-260583DiVA: diva2:847729
Annual London Business Research Conference