Journal of Business and Management

Journal of Business and Management

ISSN: 2291-1995 (Print)    ISSN: 2291-2002 (Online)

Volume 4 (2015), No. 1, Pages 1-17

DOI: 10.12735/jbm.v4i1p01

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Global Growth from an Investor's Point of View - Initial Public Offerings in the Fashion and Accessories Industry

Steffen Meinshausen1  Dirk Schiereck1  Christian Flore1 

1Department of Law and Economics, Hochschulstrasse 1, 64289 Darmstadt, Germany

URL: https://doi.org/10.12735/jbm.v4i1p01

To Cite this Article     Article Views: 855     Downloads: 488  Since deposited on 2015-02-27

Abstract

In this paper we analyze the long-run stock price performance of 207 initial public offerings in the fashion and leather accessories industry between 1990 and 2007. We find a highly significant underperformance of IPO stocks compared to corresponding benchmark indices. Cross-sectional regression analysis reveals that underperformance is mainly driven by offerings of smaller, less mature companies that are not taken public by a prestigious underwriter. Nevertheless, we also find that fashion IPO firms experience a considerable reduction in their systematic risk exposure due to the realization of real options which helps to explain at least part of their seemingly poor stock price performance.

JEL Classifications: D53, G32, L67

Keywords: Beta analysis, fashion and accessories industry, initial public offerings, long-term stock price performance, systematic risk reduction, underpricing

To Cite this Article: Meinshausen, S., Schiereck, D., & Flore, C. (2015). Global growth from an investor's point of view - Initial public offerings in the fashion and accessories industry. Journal of Business and Management, 4(1), 1-17. https://doi.org/10.12735/jbm.v4i1p01

Copyright © Steffen Meinshausen et al.

Creative Commons License
This article is published under license to Science and Education Centre of North America. This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International License.

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Global Growth from an Investor's Point of View - Initial Public Offerings in the Fashion and Accessories Industry
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