• International Commerce and Information Review
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• v.7 no.4
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• pp.325-349
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• 2005

One aspect of the globalization of the financial market after the 1980s is represented by the concurrent monetarization of the national stock markets. As the IR activity is regarded as a new financial productivity measure, the IR activity in the stock market is being emphasized domestically and internationally. This study analyzes domestic IR activities and compares them with foreign IR activities. Specifically the "road show", a typical IR activity, which is known to resolve the information asymmetry between the firm and the investors is analyzed to see the extent of the their value increase impact on the firm. The study employs domestic and international firms that publicly announced "road shows" after April 2004. Event studies are done to see the existence of abnormal return after the public announcement of road shows. Domestic firms were found to have positive IR impacts on the stock prices, but international firms were found to have negative IR impacts on the stock prices. Also it was found that international public announcement of the road show have stronger positive impact on the stock price than domestic public announcement. The investigation of the statistically significant difference of CAR before and after the fair public announcement enforcement rule showed that the positive CAR impact is strengthened after the adoption of the rule. The conclusion is that increase of the firm value after the road show implies that the information asymmetry is reduced by the active IR actions on the firm side. The policy implication is that we have to reassure the understanding of the role of the IR activities. Specifically Korean firms may have to encourage IR activities to share the information of the firms with the investors, which may result in the trustworthy relationship between the firms and investors.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.9 no.4
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• pp.97-109
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• 2014

The purpose of this study is, as to verify the effect of IR announcements, the IR activity to look at the usefulness. In previous study, they found that the IR announcement leads to reductions in information asymmetry, effect to positive stock price. This study examine the abnormal returns between group by corporate characteristics. The data used in this study are daily stock market returns taken from the KOSDAQ listed company with IR announcements during the 2005-2012 year(8 year). We find that follows. First, the capital market is accepted IR activity as the positive information. Second, abnormal returns of small company is higher than big size that. We show the difference of abnormal returns between the venture company and general company, the venture company's high. The abnormal returns of corporate with high ownership is above the group of low ownership. Additionally, consider interaction by firm characteristics, we show the interaction between firm size and business type. The result of two-way ANOVA is that venture corporate with big size are more abnormal returns than others. Also, we demonstrate that firm location is the factor of difference on information effect in venture firm.