Risk Management Strategy in IPO Activity
- https://doi.org/10.2991/aebmr.k.220307.071How to use a DOI?
- Review; Initial Public Offerings; Risks; Litigation
While more firms choose to go public, more risks are involved. To reduce accompanied risks, we review the theory, evidence, and correspondence strategies on different risks of IPO activity: (1) IPO failure risk, (2) litigation risk, and (3) systematic risk. Our perspectives are threefold: First, we evaluate the life cycle theory and market time theory of pre-IPO activity. We believe that going public at the right timing and with reasonable market forecast will reduce failure risk. Second, the potential cost of litigation risk is high, and the risk is related to underperformance and misstatement. Third, market factors are the determinants of risk levels. We conclude that litigation risk is in fact rather threatening due to the nature of exposure and transparency.
- © 2022 The Authors. Published by Atlantis Press International B.V.
- Open Access
- This is an open access article under the CC BY-NC license.
Cite this article
TY - CONF AU - Xinyi Zhang AU - Wenxi Zhong AU - Chongxi Bai PY - 2022 DA - 2022/03/26 TI - Risk Management Strategy in IPO Activity BT - Proceedings of the 2022 7th International Conference on Financial Innovation and Economic Development (ICFIED 2022) PB - Atlantis Press SP - 444 EP - 450 SN - 2352-5428 UR - https://doi.org/10.2991/aebmr.k.220307.071 DO - https://doi.org/10.2991/aebmr.k.220307.071 ID - Zhang2022 ER -