Registrations of SEOs serve to galvanize information gathering about issuers. We posit that market reaction to new information influences issuers' decision about their final offer size. The offer size relative to the amount filed initially is a parsimonious measure which helps predict subsequent...

Stock returns around security offering announcements are conditional on firms' self-selection into a particular security type. We use a switching regression methodology on a data set of U.S. straight debt, convertible debt, and seasoned equity offerings to estimate counterfactual announcement...

This paper examines the valuation of venture capital (VC)-backed IPOs in Canada and the US over the 1986-2007 period. The data indicate that differences in listing standards between Canada and the US account for fact that IPOs are valued substantially lower in Canada. We consider alternative...

The link between the real and financial decisions of firms has been studied for many years, yet it remains poorly understood. Neoclassical investment theories such as Tobin's q posit a direct, simple link between the market's valuation of the firm and investment decisions: firms invest when the...

This study evaluates the relationship between international cross-listings and shareholders' wealth across different host markets and across time. For a sample of cross-listings by European companies in the US, in the UK, and within Europe, the findings show that US and UK cross-listings, on...

This paper examines the relationship between stock and option markets around SEO events. We compare option-implied volatility and realized volatility to show that option markets do not fully predict risk dynamics following equity issues. Moreover, we show that straddle strategies that explore...

The long-run abnormal returns following both stock repurchases and seasoned equity offerings disappear for the events in the most recent decade. The disappearance is associated with the changing market environment – increased institutional investment, decreased trading costs, improved...

I extend the sequential trade model of market-making developed by Glosten and Milgrom (1985) to a highly stylized form and obtain the following theoretical predictions. First, a stock with a lower firm-value variation is more liquid, i.e., is traded with a narrower bid-ask spread. Second,...