Efeitos da Estabilização de Preços em IPOs sobre a Liquidez de Longo Prazo

This article investigates the effect of the aftermarket short covering(ASC) carried out by the underwriter during the price stabilization periodon long-term liquidity. For nearly 10% of the IPOs in our sample that werestabilized, the ASC represented more than 40% of the whole trade volumeduring the first month after the IPO; for 60% of the IPOs, more than 20%;and for only less that 20% of the IPOs, below 10% of the trade. Weconjecture that because liquidity is a persistent characteristic of stocks,the effect of the ASC on liquidity may be last longing. In fact, we showthat the ASC has a positive effect on liquidity over the 6 months subsequentto the stabilization period. This positive relation holds true even aftercontrolling for many variables considered important to explain liquidity byprevious authors, and the instrumentalization of the ASC.