We argue that majority of the price limits imposed by stock exchanges are improper due to their rigid and objective criteria. We propose a flexible price limit system based on the predicted likelihood of improper price limit imposition. We suggest that if exchange-officials decide on relaxing or...

IPO grading is an assessment of the quality of initial equity offers. India is the only market in the world that introduced such grading process. We test the efficacy of this unique certification mechanism. Using data of 159 Indian IPOs, we find, grading decreases IPO underpricing and influences...

This paper proposes an improvement to the existing price limit systems. Using price limit data from Tokyo Stock Exchange, this study shows that price limits are costly when they obstruct rational price movements. Observable events, such as volatility spillovers and consecutive price limit hits,...