Using American Depositary Receipt (ADR) IPOs from 34 countries during 1980-2004, we find that, on average, the enforcement of insider trading laws reduces the underwriter gross spread by 49-61 basis points, which is about 10-12% of the average gross spread for ADR IPOs. This relation is present...

Sections 20 and 32 of the 1933 Glass–Steagall Act address a potential conflict of interest by banning commercial banks from the market for corporate securities underwriting. This restriction was officially rescinded in 1999 by the Gramm–Leach–Bliley Financial Modernization Act. In turn,...

A firm's stock becomes publicly tradable through an initial public offering (IPO). This study suggests a portfolio diversification perspective to explore IPOs. We examine whether investors can gain diversification benefits by adding an IPO portfolio to a set of benchmark portfolios sorted by...

We investigate how investment banks determine the gross spreads paid by American Depositary Receipts (ADRs) from 1980 to 2004. We begin by comparing the gross spreads of ADR IPOs and ADR SEOs to those of matching US IPOs and US SEOs. We document clustering at the 7% level for our ADR IPO sample...