The Seven Percent Solution

By Hsuan‐Chi Chen, Jay R. Ritter. 2000

791 citations recorded by the source corpus.

View Paper: https://www.semanticscholar.org/paper/439b9ad2e54ca26fcc6dc285cba87b0c775be0cf

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Citations in the corpus

Analysts' Selective Coverage and Subsequent Performance of Newly Public Firms (2006, background): “For IPOs issued during the period 1985-1997, Chen and Ritter (2000) report that 2,911 firms receive research coverage from at least one analyst within one year of going public for a sample of 3,203 IPOs with proceeds over $20 million (1997 purchasing power).”
Dancing with Strangers: Aspiration Performance and the Search for Underwriting Syndicate Partners (2005, neutral): “549/ASQ, December 2005 Dancing with Strangers Maginson and Weiss, 1991), where underwriting fees and margins are relatively constant across the industry, averaging roughly 7 percent (Ljungqvist and Wilhelm, 1999; Chen and Ritter, 2000).”
Stock Market Liquidity and the Cost of Issuing Equity (2005, background): “3See Chen and Ritter (2000) for a discussion of clustering in IPO fees and (lack of clustering in) SEO fees. low liquidity, ceteris paribus.”
Allocation of initial public offerings and flipping activity (2003, positive): “As discussed by Chen and Ritter (2000), 60 percent of the gross spread is normally a selling concession.”
The Role of IPO Underwriting Syndicates: Pricing, Information Production, and Underwriter Competition (2005, background): “9 These patterns are consistent with those documented by Lungqvist and Wilhelm (2003) for 1996-2000 and Chen and Ritter (2000) for 1985-1997. of syndicate composition are used as dependent variables: the number of underwriters in the syndicate, the number of co-managers, the proportion of shares…”
Market Microstructure: A Survey (2000, neutral): “More recently, Chen and Ritter (1999) suggest that underwriters implicitly collude to set underwriting spreads, citing evidence that the great majority of underwriting spreads are exactly 7%. Chen and Ritter's article, like that of Christie and Schultz (1994), has triggered an investigation by regul”
Grandstanding, certification and the underpricing of venture capital backed IPOs (2004, positive): “Consistent with Chen and Ritter (2000) , gross spreads are approximately 7% and are not different between VC and non-VC backed IPOs.”
Seasoned Equity Offerings: Quality of Accounting Information and Expected Flotation Costs (2009, neutral): “In addition, there is considerable dispersion in SEO gross spreads, unlike the well documented concentration of IPO gross spreads around 7% found by Chen and Ritter (2000).”
Venture Capital and IPO Lockup Expiration: An Empirical Analysis (2001, neutral): “Why lockups lengths have become so standard is unclear, although Field and Hanka (2000) suggest that it may be related to standardization of underwriting spreads discussed in Chen and Ritter (1999).”
Discounting and Clustering in Seasoned Equity Offering Prices (2004, background): “Using a sample of SEOs, Corwin (2003) finds that underwriters are likely to set offer prices at the closing bid quote for Nasdaq-listed issues compared to the closing transaction price for New York Stock Exchange (NYSE) firms.”
Local Underwriter Oligopolies and IPO Underpricing (2011, positive): “…value in the short 4 We assume that the non-price dimensions are paid for through underpricing rather than explicit payments (the gross spread) given the evidence from Chen and Ritter (2000) that the gross spreads for almost all moderatesized U.S. IPOs from 1990 to 1998 are clustered at exactly 7%.”