Initial Public Offerings: A Study of the Nordic Market

Abstract

We present a quantitative study within the field of corporate finance to investigate underpricing on initial public offerings within the Nordic financial markets. Our design allows us to study how the technology sector differs compared to other sectors with new and unique data. Moreover, is the technology industry subject to higher degrees of uncertainty compared to other sectors? Is there a reason for large valuation differences? We find that IPO underpricing is present in the 455 IPOs from 2010-2018. Further, we find that in general, initial returns of technology firms differentiate from the market average. We conclude that firm size can explain some of the variation in underpricing, and that this also holds for technology firms.