Shelf versus traditional seasoned equity offerings: The impact of potential short selling

Dutordoir, Marie, Strong, Norman and Sun, P ORCID: 0000-0002-5510-8014 (2019) Shelf versus traditional seasoned equity offerings: The impact of potential short selling. Journal of Financial and Quantitative Analysis, 54 (03). pp. 1285-1311.

Access the full-text of this item by clicking on the Open Access link.

Text
ShelfOffers.docx - Author Accepted Manuscript
Download (224kB)

Official URL: https://www.cambridge.org/core/journals/journal-of...

Abstract

Traditional seasoned equity offerings (SEOs) elicit short selling from traders trying to increase offering discounts. Such short selling is more difficult for shelf offerings because the time between their announcement and issuance tends to be shorter. We predict and find that firms with higher short-selling potential (SSP) are more likely to choose shelf over traditional SEOs. This result is robust to alternative proxies for SSP and other sensitivity tests. Further analysis suggests that shelf issuers aim to mitigate the threat of manipulative short selling. Our findings add to a growing literature showing that short selling has a real impact on corporate finance decisions.

Item Type:	Article
Depositing User:	Symplectic Admin
Date Deposited:	07 Sep 2018 15:35
Last Modified:	19 Jan 2023 01:24
DOI:	10.1017/S0022109018000911
Open Access URL:	https://www.research.manchester.ac.uk/portal/en/pu...
Related URLs:	Author Publisher
URI:	https://livrepository.liverpool.ac.uk/id/eprint/3025945