Two contrasting explanations are offered in the literature for the R&D-to-market anomaly: mispricing of R&D resulting from limited investor attention to R&D spending, and the failure of conventional risk factors to completely capture the risk associated with R&D. Exploiting accounting treatments...

Using a unique institutional feature of the South Korean initial public offerings (IPO) market, in which firms can opt to list on a pre-IPO market (pre-market), we investigate the effect of pre-market trading on IPO performance. We find that firms that were involved in pre-markets are less...