Please use this identifier to cite or link to this item: http://repo.lib.jfn.ac.lk/ujrr/handle/123456789/1652
Title: Investor recognition, liquidity, and post-issue performance following rights offerings: Evidence from a frontier market
Authors: Velayutham, E.
Keywords: Investor recognition;stock market liquidity;post-issue performance;rights offerings
Issue Date: 2019
Publisher: Faculty of Management Studies & Commerce, University of Jaffna
Citation: Velayutham, E., 2019. Investor recognition, liquidity, and post-issue performance following rights offerings: Evidence from a frontier market. International Journal of Accounting and Business Finance, 5(2), pp.104–120. DOI: http://doi.org/10.4038/ijabf.v5i2.47
Abstract: This paper examines changes in investor recognition and liquidity around rights offerings in a frontier market, viz., Sri Lanka. We find that offer characteristics such as issue proceeds and offer price discounts improve investor recognition. We find that larger offer price discounts and offer proceeds are associated with increases in investor recognition. Further, we find that announcements of rights issues reduce information asymmetry and as a result, liquidity improves in the post rights issue announcement period. In addition, we find a strong positive association between liquidity improvements and increases in investor recognition. Finally, we find that greater investor recognition is negatively associated with contemporaneous and post- issue abnormal stock returns, whereas increases in liquidity are positively associated with post-issue abnormal returns. Overall, we show that rights issues in a frontier market affect both investor recognition and liquidity.
URI: http://repo.lib.jfn.ac.lk/ujrr/handle/123456789/1652
ISSN: E-ISSN: 2448-9875
Appears in Collections:IJABF 2019

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