The Performance of Newly Issued Stocks in Thailand

Vesarach Aumeboonsuke, Nopphon Tangjitprom

Abstract


This paper aims to examine the relative long-run performance of the newly issued stocks in the Stock Exchange of Thailand (SET). The sample of 325 newly issued stocks in Stock Exchange of Thailand during the year 1990 – 2006 is filtered to 314 stocks by excluding the issues during the mid-1997 to 1998 Asian Financial Crisis period. 3-year and 5-year holding period returns of IPO portfolio are compared with those of the matching firms. In addition to the event study, the time series cross-sectional regressions are employed to investigate the long-run overpriced of newly issued stocks when controlling for size and Book-to-Market Value ratio. The overall results show that, relative to that of the size-matched portfolio, the long-run performance of portfolio consist of was underperformed by approximately 15% and 29% for the three-year holding period portfolio and five-year holding period portfolio, respectively.


Full Text: PDF DOI: 10.5539/ijef.v4n1p103

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This work is licensed under a Creative Commons Attribution 3.0 License.

International Journal of Economics and Finance  ISSN  1916-971X (Print) ISSN  1916-9728 (Online)

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