The Effect of Short Sales Constraints on SEO Pricing

• Main Authors: Charoenwong, C., DING, David K., Wang, Ping
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2006
• Subjects: short sales constraint; information asymmetry; seasoned equity offering (SEO); SEC Rule 105.; Finance and Financial Management; Portfolio and Security Analysis
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/716
• Institution: Singapore Management University

This article examines the influence of SEC’s Rule 105, Regulation M on the information environment surrounding the offer day of a seasoned equity offering (SEO). The results of this study show that the constraints on short sales imposed by the Rule inhibit informed trading for offers with private ad...