Pichler, Pegaret; Stomper, Alex - In: Quarterly Journal of Finance (QJF) 04 (2014) 03, pp. 1450016-1
In some countries, it is common that initial public offerings (IPOs) are preceded by forward ("when-issued") trading of the shares; in the US, such trading is prohibited. We analyze the effect of when-issued trading on the pricing and allocation of IPO shares. We demonstrate that the optimal...