Asia-Pacific Journal of Business (아태비즈니스연구)

KNU The Institute of Management & Economy Research (강원대학교 경영경제연구소)
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The Impact of Investment Competition Rate on Overreaction in the KOSDAQ IPO Market: Focusing on the Economic Crisis

KOSDAQ IPO 시장에서 투자경쟁률이 과잉주가반응에 미치는 영향: 경제위기를 중심으로

  • Kyung-Soon Kim (Division of Business Administration, Chosun University)
  • Received : 2024.08.30
  • Accepted : 2024.09.25
  • Published : 2024.09.30
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Abstract

Purpose - This study investigates whether the relationship between investment competition rates (institutional investors, general investors, employee stock ownership) in the KOSDAQ IPO market and stock price overreaction after a new listing is different depending on economic conditions (economic crisis and non-economic crisis). Design/methodology/approach - I set the stock price overreaction measured by subtracting the five-day cumulative excess return from the IPO first-day return as the dependent variable, and the investment competition rate by investor type as the explanatory variable. Then, I divided the sample by economic conditions and conducted a regression analysis. Findings - Unlike other investment competition rates, I find that the positive relationship between the IPO subscription competition rate of general investors and the post-IPO stock price overreaction increases during economic crises. Research implications or Originality - The findings of this study suggest that the inflow of individual investors seeking short-term performance into the KOSDAQ IPO market increases during economic crises, and their sentimental investment behavior increases the stock price overreaction after the IPO.

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Acknowledgement

이 논문은 조선대학교 학술연구비의 지원을 받아 연구되었음(2023).

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