Acting as the source of exogenous illiquidity, trading constraints prevent free trading of shares and discount their value relative to freely traded counterparts with identical dividends and voting rights. This paper numerically solves the theoretical illiquidity discounts for the restricted...

We examine the impact of the Split Share Structure Reform on the well-known foreign share discount puzzle in China. Existing literature confirms that foreign investors are more concerned about insider expropriation because of their information disadvantage relative to domestic investors. The...

The recent Split Share Structure Reform launched by the government in the Chinese stock market terminates trading constraints on restricted shares. In exchange for the consent of freely traded shareholders, restricted shareholders offer them consideration mainly in the form of restricted shares....