Abstract
The IPO market can achieve financing function of the stock market after the IPO listed companies enter the securities market circulation. The IPO market and the secondary stock market complement each other and there is a strong relationship between them. In the study of the impact of the secondary stock market for the IPO market, based on supply and demand theory, the stock market expansion is a bad news which will lead to huge financing unilateral fall. This article mainly studies the impact of IPO on the secondary stock market. On the basis of theoretical analysis, we use linear regression model based on least-square method to explore the relationship between them, and confirm that the IPO issues have negative impact on the stock market retunes. When the external factors in the model and controlling factor within the model maintain equilibrium, the changes of the stock market rate of return caused by IPO financing are very significant. Stock market returns of IPO financing have considerable flexibility. At the end of the paper, some suggestions are put forward to strengthen the construction of the issuer integrity, the exit mechanism of listed companies and strengthen the supervision of matter and afterwards.
Highlights
Initial Public Offering refers to a company limited by shares to the public for the first time
Jianglin Lv and Peng Zeng [12] obtained there was excessive expansion of the stock market in the period 1990 to 2010 using VEC model, which made the current share price index should be significantly lower than the theoretical level. They suggested that appropriately reduce the supply of stock and reduce the size of IPO financing of China’s stock market is an effective way out of the doldrums
Descriptive Analysis According to the data collected, IPO financing on the secondary stock market can be seen from Figure 1
Summary
Initial Public Offering refers to a company limited by shares to the public for the first time. In order to prevent the sharp drops in the short term of stock market, China Securities Regulatory Commission tend to introduce Good policy or suspend the IPO. Pause and restart the IPO, becoming one of the most common means of regulating the stock market by regulatory authorities, which is the main reason why China’s stock market is considered a “policy market”. Throughout the 20 years of development of China’s stock market, China Securities Regulatory Commission implemented a total of nine IPO pause and restart. The fact is that a short pause IPO makes a correction in most cases, but the long-term downward trend has not suspended because the IPO It cannot completely reverse the bearish market and restart IPO will have a negative impact on the secondary market. The study of direction and degree of the influence of the IPO of stocks in the secondary market is necessary for the establishment and perfection of China’s stock market after registration system released
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
