Secondary Market Prices Research Articles

Preposterous Pricing: A Case of the Secondary Market for the Playstation 5

Volatile market conditions, likely caused by the COVID-19 pandemic, have caused a highly active secondary market for the Sony PlayStation 5 on online marketplaces since the console’s launch on 12th November 2020. Those who have purchased a console have found it profitable to resell it at premium prices on online auction websites, such as eBay. This research aims to use eBay’s online marketplace to gauge what factors impact consumers’ willingness to pay for the console in secondary markets. Our results show that aspects of console listings, such as the edition and included accessories, largely explain variation in final secondary market prices. Secondly, sellers’ reputation management does not appear to be crucial for business in online marketplaces.

Do uncertain outcomes matter for ticket prices? Examination of the National Football League's secondary ticket market

PurposeThis study examines the impact of outcome uncertainty on the National Football League (NFL) secondary ticket market prices. As a demand-driven market, it is essential to comprehend how resellers respond to outcome uncertainty, one of the consumer demand factors in sports.Design/methodology/approachUsing real-time ticket prices and money lines as a proxy of the probabilities of winning, this study employs a regression analysis and examines 33,554 price observations from the NFL’s secondary ticket market partner, StubHub.FindingsThe result shows a positive relationship between outcome uncertainty and secondary market ticket prices, indicating that resellers adjust the prices in response to the level of outcome uncertainty and put more value on games with greater uncertainty. This finding confirms the demand-driven nature of the secondary ticket market, as outcome uncertainty is one of the demand factors in sports.Originality/valueThis study links the uncertainty of outcome hypothesis with secondary ticket market pricing and fills a gap in the literature by providing an important perspective on games with uncertainty in the secondary ticket market. Outcome uncertainty has limited understanding in relation to secondary ticket market pricing despite its relationship with consumer demand. The positive relationship between outcome uncertainty and the ticket prices, grounded in real-time price data and win probability from sport betting markets, enhances our understanding of price determinations in the secondary ticket market.

Do Investors’ Site Visits Improve Bond Market Pricing Efficiency? —An Empirical Study from the Secondary Bond Market

ABSTRACT Taking bonds issued by A-share companies listed on the Shenzhen Stock Exchange from 2014 to 2020 as a sample, this paper explores the effect of corporate site visits on bond trading spreads. The study finds that the more investors visit a given firm, the lower the trading spreads of bonds issued by that firm, and this phenomenon is more pronounced in companies with greater information asymmetry or agency conflicts. Further research shows that investors evaluate the financial status of the company more accurately through site visits and reduce irrational decisions caused by information uncertainty. Consequently, site visits reduce the financing gap caused by macroeconomic factors. The results show that personal communication between investors and listed companies could provide effective information for bond investors and reduce their information risk. This paper expands the existing research on issues related to secondary bond market pricing and investors’ site visits and provides important empirical evidence for regulators to use to further optimize the bond market disclosure system to reduce information asymmetry.

Integration and Cointegration of Apartment Prices on the Primary and Secondary Market in Szczecin in the Years 2006-2022

Abstract The objective of the paper is to verify hypotheses regarding integration and cointegration (relation) of mean apartment prices on the primary and secondary market in Szczecin. Both transaction prices as well as offer prices of apartments were investigated. The analysis period encompasses the years of 2006 – 2022 (quarterly data). An ADF test was employed to examine the integration of time series, taking into consideration a deterministic component in the form of a quadratic function. Only the time series of mean offer prices and transaction prices on the primary market proved to be integrated in the first degree. The time series of mean offer prices and transaction prices on the secondary market were not integrated, they occurred to be trend stationary series. A two-step Engle-Granger test was employed to analyze the cointegration of time series, which confirmed the cointegration of mean offer prices and transaction prices on the primary market. The relations between individual price types were examined with the use of a procedure which entailed analyzing (with an ADF test) difference stationarity between prices. From the empirical studies it arises that, in Szczecin, transaction and offer prices on the primary market follow one another. On the secondary market, offer and transaction prices are trend stationary and they converge. On the other hand, prices on the primary market diverge from prices on the secondary market (the primary market diverges from the secondary market). This concerns both offer prices as well as transaction prices.

Do Underwriters Short-Change Corporations Issuing Bonds?

AbstractWe confirm prior evidence that bonds on average are offered at prices below their immediate post-offer secondary market prices. However, in cases where banks lead–manage their own bond offerings the underpricing is significantly less as compared with other non-self-marketed offerings. These findings are robust across various matched samples and selection models. Our results suggest that the bond offering process is characterized by substantive agency conflicts between shareholders of corporations (issuers) and underwriters.

Digitalization in Investment: Reworking and rethinking of retail investors investments in multiple funds via digital channels

The study represents the digitalization of financial market (FMs) and financial intermediaries (FIs) must enhance the investor toward digitalization and scope of investment though digitalization of investment pattern. It would evaluate the effect of digitalization on interaction and performance of investor to achieve their investment goals. The digitalization in financial services allow the investor to have greater access to primary and secondary market information, investment funds, rates and prices of funds and/or instrument, and the investor can easily personalize their own investments. The direct and personal touch with markets presents new investment opportunities, as the investor may make good or poor decisions. The FMs and FIs need to concern with investor and other intermediaries to create new ways of communication and development in investment decision making and execution of the same. The study should try to focus on the varied areas of digitalization has been taken placed, also suggest for improvements.

Deliberate underpricing and after-market mispricing in Indian IPO market: Stochastic frontier approach

Purpose This paper aims to study the underpricing phenomenon of initial public offerings (IPOs) of 355 Indian companies issued from 2007 to 2019. The research question this paper empirically examines is whether Indian corporate executives deliberately underprice IPOs from its fair value to attract investors, thereby causing an abnormal spike in the prices on the listing day. The findings of this study challenge a commonly held notion of leaving money on the table by IPO issuing companies. Of the overall average listing day returns of 17%, the deliberate premarket underpricing component is found to be mere 5.3%, while the remaining price fluctuation is, inter alia, a result of market momentum along with the unmet demands of impatient investors. Design/methodology/approach Following Koop and Li (2001), this study uses Stochastic frontier model (SFM) to study a routine anomaly of disparity between the primary market price (i.e. IPO issue price) and the secondary market price (listing price). The jump in the issue price observed on a listing day is decomposed into deliberate premarket underpricing component that reflects the extent of managerial manipulation and the after-market misvaluation component attributable to information asymmetry and prevailing market volatility. Findings This paper uses SFM to bifurcate initial returns into deliberate underpricing by managers and after-market mispricing by noise traders. This study finds that a significant part of the initial return is explained through after-market mispricing. This study finds that average initial returns are 17%, deliberate premarket underpricing is 5.3% and after-market mispricing averages 11.9%. Research limitations/implications This study can isolate underpricing done at the premarket by estimating a systematic one-sided error term that measures the maximum predicted issue price deviation from the offered price. Consequentially, the disaggregation of initial returns may be especially informative for retail investors in planning their exit strategy from an IPO by separating the strength of the firm's fundamentals and its causal relationship with the initial returns. Substantial proportion of after-market mispricing implies that future research should focus on factors causing after-market mispricing. As underlying causes are identified, tailor-made policy responses can be formulated to benefit investors. Practical implications This paper has empirically validated that initial return is a mix of both components, i.e. deliberate underpricing and aftermarket mispricing. This disaggregation of initial returns can prove helpful for investors in planning their exit strategy. This study can help investors to become more aware of the importance of the fundamentals of the firm and its causal relation with the initial returns. This information in turn can help reduce the information asymmetry amongst investors and help them lessen the costs of adverse selection. Originality/value A large number of research studies on IPO pricing find overwhelming evidence of underpricing in public issues. This research attempts to decompose the extent of underpricing into deliberate underpricing and after-market mispricing, thereby supplementing the existing literature on the IPO pricing puzzle. To the best of the authors’ knowledge, this study is the first contribution to the literature on initial return decomposition for the Indian capital markets.

GPU PRICES AND CRYPTOCURRENCY RETURNS

We look at the association between the price of a cryptocurrency and the secondary market prices of the hardware used to mine it. We find the prices of the most efficient Graphical Processing Units (GPUs) for Ethereum mining are significantly positively correlated with the daily price returns to that cryptocurrency.

GPU PRICES AND CRYPTOCURRENCY RETURNS

We look at the association between the price of a cryptocurrency and the secondary market prices of the hardware used to mine it. We find the prices of the most efficient Graphical Processing Units (GPUs) for Ethereum mining are significantly positively correlated with the daily price returns to that cryptocurrency.

Research on the Influence of RMB Exchange Rate on oil Painting Auction Price

Based on the interaction between RMB exchange rate and oil painting auction price, this paper first introduces the current development of art market at home and abroad, and studies the main pricing methods. Then, according to the auction data of China's oil painting market, this paper analyzes the corresponding attributes of works, artists and auction houses to understand the impact of RMB exchange rate on oil painting auction price. At the same time, it analyzes the auction price of realistic oil painting and abstract oil painting in the secondary auction market. According to some expected conclusions set by market common sense, we finally found the evidence of these expected conclusions in the data. For example, the appreciation of RMB exchange rate has its inherent rationality and imperfection to the pricing method according to the size of the area, there are obvious differences between different styles of oil paintings in terms of price and exchange rate levels, top auction houses have obvious premium to their oil paintings, and the change of RMB exchange rate has obvious positive effect on the price of oil paintings. The innovations of this paper are as follows: 1. This paper makes a comparative study on the secondary auction market prices of realistic and abstract oil paintings in the domestic contemporary art market, and discusses the important factors of RMB exchange rate on the auction price. 2. The three-level model is used to analyze and compare the work level, the artist level and the auction agency level, so as to explore the "invisible" rules of the market. 3. Using the method of scoring and rating by people in the auction industry to comprehensively weigh the position of the auction house in the industry, we can achieve excellent results and understand the relative nature of RMB exchange rate on the oil paintings sold by the auction house. The deficiency of this paper is mainly due to the data is not sufficient, data is not rich enough; many problems still exist in the conclusion of the error.

LEGO Secondary Market Price Data

LEGO Secondary Market Price Data

Price Discovery of Consignment Auctions for Emission Permits

A consignment auction aims to increase political feasibility by reducing the financial burden of initial permits allocation and to do the role of price discovery. However, previous analytical models presented contradictory results for the price discovery function of a consignment auction. Thus, this study reexamines whether a consignment auction can perform its price discovery function. The study uses a simple game model with several assumptions differentiated from previous analytical models: explicit consideration of the secondary market and firms as price-takers with various behaviors to respond to uncertainty about the price in the secondary market. Firms are classified into three types: speculators who seek arbitrage, doctrinarians who determine a permit demand based on an estimation of their marginal abatement cost, and neutralists who keep a permit demand the same as initial emission endowments. The results reveal that when a consignment auction was introduced, the expected equilibrium price was identical to that of the secondary market price, demonstrating that the auction could deliver the price discovery function. This is because speculators and doctrinarians provide information about their price expectations and marginal abatement cost through their estimated demand functions. Additionally, the smaller number of neutralists is, and the higher the risk-seeking propensity of speculators is, the more effective the price discovery function is.

Unbridled spirit: Illicit markets for bourbon whiskey

The market for bourbon whiskey is booming. Demand is so great that bourbon aficionados regularly line up overnight for the chance to purchase a single bottle and high-end bourbons are allocated to consumers via lotteries. The prevalence of such non-price allocation mechanisms, however, leads to reselling in secondary markets. To characterize bourbon secondary markets, we first provide a rich description of how they function. We then use 2011 to 2019 whiskey auction data in a repeat sales regression framework to develop a novel price index for rare and vintage bourbons. Our repeat sales approach suggests that bourbon prices are increasing by about 9.1% per year over our sample period. We complement those estimates by developing a second price index using unique data from an illicit peer-to-peer secondary market that operated on a major social network between 2014 and 2017. Our estimates suggest that price increases are similar, at least during common sample periods, in our auction-house and peer-to-peer settings. We also examine how bourbon’s hedonic characteristics are related to secondary market prices and develop hedonic estimates of annual returns that range between 13.1% and 18.8%. While our sample period is relatively short, when examining bourbon’s potential as an alternative investment we find that the addition of bourbon can improve the risk-return ratio of typical stock/bond portfolios.

Liquidity and price pressure in the corporate bond market: evidence from mega-bonds

Larger bonds offer greater liquidity, which should reduce their yields. A simple way for firms to reduce financing costs is to sell bonds with large face values. We find that mega-bonds are more liquid than smaller bonds. However, offering yield spreads on mega-bonds are not lower and are higher than spreads of bonds issued by similar companies. The discount applied to large new issues is consistent with price pressure effects that are also present in the secondary market prices of the issuing firm's existing bonds. Our results suggest a hidden cost to issuing very liquid bonds.

The value of social status

We quantify the value of social status using secondary market prices for Delaware license plates. Delaware plates are numbered sequentially, are private property, and can be legally bequeathed or traded. In Delaware, they are a valuable source of social status. Market prices suggest a preference for lower plate numbers and there are extreme price jumps that are consistent with exclusive low-digit clubs. The aggregate value of this market indicates that people purchase status as a significant portion of their consumption bundle. Finally, social status as an asset appears to be uncorrelated with aggregate economic and market conditions.

At what price should Bordeaux wines be released?

AbstractThis paper models optimal release prices of an experience good recurrently issued on markets. Using a sample of Bordeaux wines, we find that using a minimal number of intrinsic and extrinsic attributes is sufficient to explain a large proportion of release prices. We further observe a significant relationship between primary market prices and secondary market prices and general economic conditions. Release prices can deviate from secondary market prices in the short run but remain aligned over the long run. Finally, an out‐of‐sample analysis indicates that short‐run mispricing directly affects the purchase behavior of customers.

DETERMINANT OF INDONESIAN GOVERNMENT BOND ‘YIELD’ IN DOMESTIC PRIMARY MARKET

This study aims to analyze determinants which might influenced yield of Indonesian Government Bond Denominated-Rupiah in primary market. We divide the determinant by three factors (i.e intrinsic factor, extrinsic domestic factor and extrinsic globar factor). Multiple regression using to analyze colinearity among variables in this study. The results showed that bond maturity, bond coupon rate, bond price in secondary market, bond performance in market, inflation rate, currency, money and stock domestic market condition, and money and bond global market condition are significantly affected Indonesian government bond yield in primary market.

GPU Prices and Cryptocurrency Returns

We look at the association between the price of a cryptocurrency and the secondary market prices of the hardware used to mine it. We find the prices of the most efficient Graphical Processing Units (GPUs) for Ethereum mining are significantly positively correlated with the daily price returns to that cryptocurrency.

The return on secondary market trades of open-end real estate funds in liquidation

As a result of the liquidity crisis in October 2008, 18 open-end real estate funds with a total volume of €26 billion in assets under management had to be liquidated. Many shareholders decided to sell their shares on the secondary market instead of awaiting the iterative liquidation of the fund assets. This paper estimates and explains the returns of these secondary market trades based on a unique dataset comprising secondary market prices and individual fund characteristics. The estimated returns exhibit an enormous variation across the funds and transaction dates. A subsiding panel regression demonstrates that the return variation can be attributed to the price-discount at which the shares traded on the secondary market and the composition of the remaining fund assets.

Review of IPO Primary Market Pricing Literature

The aim of this paper is to offer a comprehensive review of Initial Public Offering literature on the pricing and interactions that occur in the IPO primary market. Among the multitude of variables that might affect the way shares are priced and sold in new offerings, the role of previous relationships between issuing firms, investment banks, and institutional investors, i.e. key participants in the listing process, is the object of analysis in the present paper. Existing mixed evidence suggests that repeated interactions among the major players could influence the IPO results in two ways: either by reducing asymmetric information problems or by determining opportunistic behaviours which can be seen in well-known secondary market price anomalies. The originality of the paper lies in the fact that it is the first to provide a review of literature on IPO primary market dynamics, thereby highlighting the way in which relationships between key parties of an IPO shape the entire pricing process. Moreover, this study points out the importance of shifting attention to this market in order to better understand IPO pricing dynamics.