Economic influence on rights issue announcement behavior in Malaysia
The negative announcement period return for seasoned equity issues in several developed share markets has been explained as an adverse selection effect to information asymmetry between managers and investors during the expansionary phases of share market cycles. This paper reports a significant posi...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Elsevier
1999
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| Online Access: | http://psasir.upm.edu.my/id/eprint/112968/ http://psasir.upm.edu.my/id/eprint/112968/1/112968.pdf |
| _version_ | 1848866091483267072 |
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| author | Salamudin, Norhana Ariff, Mohamed Md Nassir, Annuar |
| author_facet | Salamudin, Norhana Ariff, Mohamed Md Nassir, Annuar |
| author_sort | Salamudin, Norhana |
| building | UPM Institutional Repository |
| collection | Online Access |
| description | The negative announcement period return for seasoned equity issues in several developed share markets has been explained as an adverse selection effect to information asymmetry between managers and investors during the expansionary phases of share market cycles. This paper reports a significant positive announcement period return in an emerging share market. The average return during periods of favourable economic conditions is higher than return during unfavourable periods. The term premiums, which decline (rise) during favourable (unfavourable) economic conditions, are correlated with announcement period returns. These findings support the good news hypothesis that the return is positive because investors expect the funds from issues to be used in profitable investment projects in a high growth emerging economy. |
| first_indexed | 2025-11-15T14:15:05Z |
| format | Article |
| id | upm-112968 |
| institution | Universiti Putra Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T14:15:05Z |
| publishDate | 1999 |
| publisher | Elsevier |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | upm-1129682025-01-27T06:53:37Z http://psasir.upm.edu.my/id/eprint/112968/ Economic influence on rights issue announcement behavior in Malaysia Salamudin, Norhana Ariff, Mohamed Md Nassir, Annuar The negative announcement period return for seasoned equity issues in several developed share markets has been explained as an adverse selection effect to information asymmetry between managers and investors during the expansionary phases of share market cycles. This paper reports a significant positive announcement period return in an emerging share market. The average return during periods of favourable economic conditions is higher than return during unfavourable periods. The term premiums, which decline (rise) during favourable (unfavourable) economic conditions, are correlated with announcement period returns. These findings support the good news hypothesis that the return is positive because investors expect the funds from issues to be used in profitable investment projects in a high growth emerging economy. Elsevier 1999 Article PeerReviewed text en http://psasir.upm.edu.my/id/eprint/112968/1/112968.pdf Salamudin, Norhana and Ariff, Mohamed and Md Nassir, Annuar (1999) Economic influence on rights issue announcement behavior in Malaysia. Pacific-Basin Finance Journal, 7 (3-4). pp. 405-427. ISSN 0927-538X; eISSN: 1879-0585 https://linkinghub.elsevier.com/retrieve/pii/S0927538X99000104 10.1016/s0927-538x(99)00010-4 |
| spellingShingle | Salamudin, Norhana Ariff, Mohamed Md Nassir, Annuar Economic influence on rights issue announcement behavior in Malaysia |
| title | Economic influence on rights issue announcement behavior in Malaysia |
| title_full | Economic influence on rights issue announcement behavior in Malaysia |
| title_fullStr | Economic influence on rights issue announcement behavior in Malaysia |
| title_full_unstemmed | Economic influence on rights issue announcement behavior in Malaysia |
| title_short | Economic influence on rights issue announcement behavior in Malaysia |
| title_sort | economic influence on rights issue announcement behavior in malaysia |
| url | http://psasir.upm.edu.my/id/eprint/112968/ http://psasir.upm.edu.my/id/eprint/112968/ http://psasir.upm.edu.my/id/eprint/112968/ http://psasir.upm.edu.my/id/eprint/112968/1/112968.pdf |