Relationen mellan underprissättningen av IPOs och "the partial adjustment phenomenon"

Sammanfattning: The purpose of this thesis is to investigate the relationship between underpricing of initial public offerings and the partial adjustment phenomenon. My empirical sample consists of 412 U.S. IPOs during the time period 2000-2016. My data supports that positive revisions in IPO offer prices that exceeds the offer price range, will experience a greater level of underpricing. That means a higher initial return compared to those IPOs that remained in or revised below the offer price range. Further, my results indicate that those IPOs with positive revisions in their offer price above the initial price range, also will have a greater 4 weeks performance than those other two IPO groups. Those IPOs with negative revisions in their offer prices below the initial offer price range, will experience a higher degree of underpricing than IPOs that remained in that initial price range. This study cannot confirm anything about the difference of the offer price width between those three initial IPO groups. Finally, issues with negative price revisions below the price range tend to have greater price revisions than those IPOs with a partial adjustment above the price range. The price revisions are both seen from the estimated IPO price and the high and low limits of the offer price range.