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Asian markets provide ideal experimental sample for IPO research. Market development and regulatory changes give academic researchers the chance to gain detail insights on IPO topics. The main objective of this paper is to survey the literature on Asian IPOs. We use Web of Science as a data source to collect related literature. We survey papers using Asian IPO samples to study classical IPO topics and discuss special IPO topics in Asian IPO markets. Finally, we provide suggestions for future research on this subject.

This study investigates whether institutional investors with large ownership (institutional blockholders) have informational advantages over other investors. The sample of this study is constructed from institutional investors’ mandatory filings on block shareholding of greater than 5% of a firm’s shares. Institutional blockholders are classified into active institutions if they express an intention to engage in a firm’s management as their purpose of investment and into passive institutions otherwise. To verify the information content of block ownership, this study investigates the short- and long-term market reaction to announcements of institutional investors’ block ownership. Main findings are summarized as follows. First, significant cumulative abnormal returns (CARs) are observed around the announcements. The CARs are much higher for active institutions than passive institutions. Second, the stocks owned by passive asset management companies significantly outperform both the market and the benchmark portfolio in the long-term. In contrast, the stocks owned by active private investment companies significantly underperform the benchmark portfolio. Overall, the results of this study suggest that passive asset management companies have superior skills in selecting undervalued stocks and they use long-lived information when they make large investment. In contrast, the inconsistent results on short- and long-term performance of stocks owned by active private investment companies imply that private investment companies’ activism are not effective enough to meet the initial expectations of the market.

In this study, I examine the effect of patent applications on the cost of debt. Using a sample of Korean listed firms, I show that debtholders charge a significantly lower cost of debt to a firm with higher patent counts or greater patent productivity. This finding remains robust while considering the differences of firms with patents versus without patents, controlling for unobservable firm-specific factors by employing a firm-fixed effect model, and using a dynamic panel data model to mitigate an endogeneity concern that debt financing affects patenting activity. I further explore three possible channels through which patent applications affect the cost of debt. First, patents mitigate the degree of information asymmetry between firms and potential debtholders. Second, they provide expectations for increased future cash flows. Third, patents enable improved redeployability of assets. This study sheds lights on the real effects of patent applications on firms’ costs of debt.

IPO underpricing is a subject of great interest for researchers. Previous studies have focused on the underpricing of private venture capital-backed IPOs, but mainstream academic researchers have left underpricing in government-backed IPOs largely uninvestigated. In this study, we fill this gap by analyzing the behavior of IPO underpricing for government-backed IPOs in Korea. For the purpose of this study, we examine 468 IPO cases on the KOSDAQ market during the period between 2009 and 2019. Empirical evidence shows that a unique structure of government sponsorship effectively reduces the level of underpricing in the IPO market. In particular, the dual sponsorship of government hybrid funding and private venture capital contributes most significantly to reducing the underpricing in the IPO market.

본 논문은 외국인 투자자의 국내기업 대규모 지분 인수가 대상 기업의 주가에 미치는 영향을 투자자와 기업 간 정보 비대칭과 투자자 소속 국가의 주주 권한 보호에 초점을 맞추어 분석했다. 1996년부터 2016년까지 발생했던 164건의 외국인 투자자 대규모 지분 인수를 분석한 결과, 지분 인수 공시 기간에 피인수기업의 주가가 유의하게 상승함을 발견했다. 이러한 주가 상승은 외국인 투자자와 투자 대상 기업 사이의 지리적 거리와 문화적 거리가 가까울수록 두드러지게 발생했으며, 특히 경영 참여를 목적으로 한 외국인 투자자 지분 인수 시 지리적, 문화적 근접성의 영향이 뚜렷했다. 또한 외국인 투자자가 속한 국가의 주주권리 보호 정도가 강하고 지분 인수가 경영 참여를 목적으로 한 경우에 긍정적인 공시효과가 발생했다. 이러한 결과는 기업의 정보비대칭이 상대적으로 높고 지배구조가 취약할 것으로 추정될 때 더욱 뚜렷한 것으로 나타났다. 본 연구의 실증 결과는 외국인 투자자의 대규모 지분 인수 시 기업 감시 활성화와 기업가치 상승에 대한 기대가 반영되어 피인수기업의 주가가 상승하며, 특히 외국인 투자자와 기업 간 정보 비대칭의 우려가 적고 투자자의 주주권한에 대한 인식이 높으며 기업의 정보 비대칭 수준이 높거나 지배구조가 상대적으로 취약하여 기업감시의 효과가 클 것으로 예상될수록 주가 상승이 뚜렷하게 나타남을 보여준다.

This study examines how block share acquisitions of foreign investors affect stock returns of domestic target firms in Korea, focusing on the information asymmetry between target firms and foreign acquirers and the shareholder right protection in foreign acquirers’ home countries. There are at least two important reasons that using Korean data of block share acquisitions by foreign investors benefits the literature. First, Korean firms are well known to have poor governance systems and it is thus questionable whether foreign investors can improve firm value by monitoring as an outside blockholder when the investor protection is relatively low and whether geographic and cultural proximity of foreign investors can reduce information asymmetry with relatively low firm transparency in Korea. Second, investors are legally required to disclose their block holding intentions in Korea, which helps identify the effects of monitoring by blockholders on firms’ stock returns. Using 164 block share acquisitions in which foreign investors acquire at least 5% but less than 50% of a target firm’s stock shares from 1996 to 2016 as a sample, we find that stock returns of targets significantly increase when these block acquisitions are announced. To measure the information asymmetry foreign investors face in Korea, we use both geographic and cultural distances between foreign investors’ home countries and Korea and show that the positive stock market reactions to block acquisitions by foreign investors are more pronounced when the foreign block acquirers are geographically or culturally proximate to the host country. Moreover, we show that the value-increasing effects of geographic and cultural proximity of foreign investors on target stock returns are more evident when the foreign acquirers disclose their intentions to intervene in the management of target firms, suggesting that anticipated monitoring by foreign blockholders is an important determinant of the observed market reactions to their block share acquisitions. We also investigate how the extent of shareholder right protection in the home country of foreign acquirers influences the announcement returns of block acquisitions, using as a measure the difference in the shareholder rights scores between foreign acquirers’ home countries and Korea. We find positive stock price reactions to block acquisitions by foreign investors from countries with strong shareholder rights when they announce their monitoring incentives by stock market disclosures. In addition, we investigate whether the above findings vary according to the firm-specific information asymmetry measures such as a target firm’s size, age, tangibility, and R&D intensity, whether a target is listed in the KOSDAQ market, and whether it has credit ratings and the firm-specific governance measures such as its free cash flow and board size. We show that the value-enhancing effects of block acquisitions by foreign acquirers from geographically and culturally proximate countries and countries with strong shareholder rights are particularly evident when the firms targeted by foreign acquirers are likely to have higher information asymmetry and poorer governance systems according to the above-listed measures. Our results suggest that the stock market favorably responds to block share acquisitions by foreign investors anticipating their effective roles of monitoring target firms and firm value improvement facilitated by the active monitoring. Our results also indicate that these value increases by expected monitoring by foreign acquirers are more evident when the concerns on the information asymmetry between investors and targets are lower, when foreign acquirers are likely to have higher standards for the rights of shareholders, and when active monitoring is more likely to improve corporate governance and firm value. Our study contributes to the related literature in the following ways. First, our research confirms that considering heterogeneity among foreign investors is important in examining the impact of foreign investors on firms in the host country. We show that the heterogeneity in information accessibility of foreign investors due to their geographic and cultural proximities and in the shareholder rights protection in their home country matters in market valuation of their monitoring, in addition to the heterogeneity in shareholder activism in their home country (Kim, Sung, and Wei, 2017). Second, we supplement prior studies that investigate how information asymmetry between the host country and the home country of foreign investors and shareholder rights in their home country affect their governance activities and firm value (Kang and Kim, 2010), by exploiting the system of block holding disclosures in Korea and firm-specific measures of information asymmetry and corporate governance. Specifically, our findings suggest that the stock value increase in block acquisitions by foreign investors is attributable to the monitoring intentions of foreign investors with effective information accessibility and strong governance incentives, especially in firms with higher information asymmetry and poorer governance.

본 연구에서는 중국 선전주식시장을 대상으로 비관측 공통요인을 추정하고, COVID-19 확산에 따른 업종별 상관관계의 변화여부를 실증분석 하였다. 이를 위해 선전시장의 업종별 지수를 포괄적으로 분석할 수 있는 다변량 모형으로서 DLLFM(Dynamic Linear Latent Factor Model)을 도입하였다. 본 연구의 분석기간은 2015년 1월 5일부터 2020년 8월 31일까지이며, 분석대상은 선전시장 6개 업종(제조, IT, 금융, 운송, 도･소매, 건설)의 일별 지수이다. 실증분석결과, 첫째 One Factor 잠재적 요인을 추정할 수 있는 모형의 특성을 활용하여 이분산성과 점프 리스크의 특성으로 설명될 수 있는 공통요인의 존재를 확인하였다. 둘째 시장의 지배적 흐름이 존재하는 가운데에서도 개별업종의 경제상황을 반영한 고유의 변동성 양상이 부분적으로 포착되었다. 셋째 재난리스크에 가장 민감하게 반응할 것으로 예상되는 건설업을 중심으로 상관계수를 추정한 결과, 전반적으로 높은 수준의 상관관계를 보였지만 COVID-19 발생 이후에 일시적으로 하락하는 현상이 확인되었다. 넷째 선전시장 공통요인의 실체는 약 87%가 중국전체주식시장의 시스템 리스크이고 위안/달러 환율의 위험도 상당부분 반영되어 있으며, 특히 외환시장의 위험 구성비율은 최근 들어 점점 증가추세에 있는 것으로 판단된다.

The new coronavirus(COVID-19) has shocked economies around the world, and the stock market is also facing unprecedented conditions due to the effects of COVID-19. The impact of COVID-19 on the global economy is clearly different from typical cyclical fluctuations in the traditional economic development process and economic losses from the COVID-19 pandemic will also surpass the extent of endogenous and extreme events that have occurred in the past. Assessing and understanding the economic impact of COVID-19 has become an important issue. China is the first country to respond to COVID-19, and has made great efforts to boost shrinking production and consumption. However, since the level of the virus affects different industries, it is necessary to analyze the movement of the stock market at the industrial level. The Chinese stock market was a closed market where foreigners were not allowed to invest, but it has grown rapidly as an investment destination that investors around the world pay attention to following the government's stance of opening and reforming the capital market. The leading stock indexes, the Shanghai Composite Index and the Shenzhen Component Index, represent the entire flow of the Chinese stock market, with trading centered on large-cap stocks centered on traditional industries in the Shanghai market and new industry-oriented stocks such as IT and bio in the Shenzhen market. This paper tries to estimate the dynamic linear latent factor model (DLLFM) with jump in order to find jump risk, heteroscedasticity and time varying correlations in Shenzhen Stock Markets. In addition, the impact of disaster risk on volatility by industry was also analyzed by including the occurrence and diffusion of COVID-19 in the sample period. The motivation for the study began with the view that the economic crisis caused by shot down in China, where COVID-19 first occurred, could be quantitatively assessed from an industry-specific perspective on how it spreaded to the stock market. In particular, this study has utilized DLLFM because that model can measure the coefficients of time varying correlations among those various industries of Shenzhen Stock Market. Using six major Industrial Stock Index such as Manufacturing, IT, Finance, Transportation, Whole sale & Retail, Construction from 1/5/2015 to 8/31/2020, this study finds the evidence of common factor and time-varying correlations in addition to the industry-specific idiosyncratic risk. According to the main estimated results of this paper, jump risk of common factor comes every 7.82 trading days in Shenzhen stock markets and about 87 percent of the common factor of the Shenzen stock markets can be explained by Shanghai market risk, which is China stock market risk. Also, some part of unobserved common factor of the Shenzen stock markets may be explained by foreign exchange market risk of China. And the portion of foreign exchange market risk may be increasing as the Chinese government announces the new method of calculating standard value of yuan exchange rate in August 2015. So far as concerning the time varying correlations among those indices, the levels of correlations seem to be comparatively high, but those levels are going down transiently after the occurrence of COVID-19. In this study, we are trying to investigate the Shenzen stock markets where president Xi Jinping has visited couple of times as the center for bio, information, communication, venture markets for the future of Chinese economy to cope with US-China trade dispute. We have been very much interested in finding the real nature of the latent common factor of the Shenzen stock markets. Conclusively, the findings are, some of them Chinese systemic risk, some of them foreign exchange risk. All of these suggest that the use of multivariate models such as dynamic linear latent model seems to be essential to comprehensively analyze those industry-specific indices in the course of the transition of disaster risks such as COVID-19. Also unobserved common jump and heteroscedasticity seem to be those main characteristics of chinese financial time series. According to the main results of this paper, two pillars of the Chinese stock markets, Shanghai and Shenzhen, may look quite similar, but seem to be different from the view point of the portfolio or index investments. Somehow it would be better that investors should pay attention to those characteristics of the latent common factor of the Shenzen stock markets when it comes to the risk management strategies. It seems that the similarity of two stock markets from the stand point of the nature of risk, mainly comes from the financial regulations of Chinese government.