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    This article has been cited by the following publications. This list is generated based on data provided by CrossRef.

    Duong, Truong X. Singh, Rajdeep and Tan, Eng-Joo 2015. Costly Self-Insurance of Rights Offerings. Journal of Business Finance & Accounting, Vol. 42, Issue. 9-10, p. 1251.

    Pham, Nga Oh, K.B. and Pech, Richard 2015. Mergers and acquisitions: CEO duality, operating performance and stock returns in Vietnam. Pacific-Basin Finance Journal, Vol. 35, p. 298.

    Fong, Wai-Ming and Lam, Kevin C.K. 2014. Rights Offerings and Expropriation by Controlling Shareholders. Journal of Business Finance & Accounting, Vol. 41, Issue. 5-6, p. 773.

    Brockman, Paul and Olsen, Brett C. 2013. Warrants, ownership concentration, and market liquidity. Managerial Finance, Vol. 39, Issue. 4, p. 322.

  • Journal of Financial and Quantitative Analysis, Volume 47, Issue 1
  • February 2012, pp. 213-239

Rights Offerings, Subscription Period, Shareholder Takeup, and Liquidity

  • Balasingham Balachandran (a1), Robert Faff (a2), Michael Theobald (a3) and Tony van Zijl (a4)
  • DOI:
  • Published online: 14 November 2011

We examine the role of shareholder takeup in rights offerings on the subscription period price reaction and liquidity. Our results indicate that takeup information is reflected in price adjustments over the subscription period and that quality-related information disclosed on the rights announcement date further impacts prices in this period. Higher shareholder takeup improves liquidity. We do find some evidence of inefficiencies in the adjustment process over the subscription period that, in part, is consistent with a model where markets are characterized by overconfident investors and that also articulates with takeup information arriving in the market.

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Journal of Financial and Quantitative Analysis
  • ISSN: 0022-1090
  • EISSN: 1756-6916
  • URL: /core/journals/journal-of-financial-and-quantitative-analysis
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