Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/25228
Title: The impact of the costs of subscription on measured IPO returns : the case of Asia
Authors: Fung, JKW
Cheng, LTW 
Chan, KC
Keywords: Asian IPOs
Initial public offerings
Non-discretionary allocation
Issue Date: 2004
Publisher: Elsevier Science Bv
Source: Journal of corporate finance, 2004, v. 10, no. 3, p. 459-465 How to cite?
Journal: Journal of Corporate Finance 
Abstract: Asian initial public offerings (IPOs) require investors to pay subscription funds up-front upon submission of applications, and these funds are locked-up for 1-3 weeks without interest. Hence, the IPO process entails an explicit financing cost (opportunity cost) whether investors borrow funds or use their own funds to apply for IPO shares. The IPO subscription costs are not trivial, especially in a high interest rate environment or when an IPO is highly oversubscribed. These costs should be considered in any comparison of IPO returns across countries.
URI: http://hdl.handle.net/10397/25228
ISSN: 0929-1199
DOI: 10.1016/j.jcorpfin.2003.08.002
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