Market Timing as an Explanation for the Short‐Lived Premium on Cross‐Listing

Abstract

This study provides further evidence on the cross‐listing valuation premium using a sample of Asian firms from 2000 to 2010. First, following Doidge et al. (2004), we document a premium, but it disappears when we incorporate firm fixed effects. Second, consistent with Gozzi et al. (2008), we find that the premium arises immediately preceding the cross‐listing year and disappears shortly thereafter. Of central interest, consistent with our proposition that the listing is strategically timed like an SEO, we document a similar pattern in operating performance, and increased financing activity in the listing year and the following 2 years.