What question did this study set out to answer?

This research explores the effects of IPO pricing at high-end ranges on initial returns.

June 15, 2026Open Access

High-End IPO Prices

CMClemens MuellerErasmus University Rotterdam PVPatrick VerwijmerenThe University of Melbourne

Key Points

This research explores the effects of IPO pricing at high-end ranges on initial returns.
Analyzed IPO pricing data to compare first-day returns based on pricing positions.
Identified trends in pricing strategies among firms working with underwriters.
IPOs priced at the high-end showed substantially higher first-day returns compared to those priced slightly below or above.
Positive perceptions of high-end pricing may enhance investor interest and early performance.

Abstract

Abstract Many IPOs are priced at exactly the high-end of the pricing range. Investing in IPOs priced at the high-end leads to first-day returns that are substantially higher than investing in IPOs that are priced just below or above the high-end. We argue that these results are in line with issuing firms settling for positively perceived salient pricing points in negotiations with underwriters.

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Cite This Study

Mueller et al. (Thu,) studied this question.

synapsesocial.com/papers/6a2f973ca1cfeec490828492 https://doi.org/https://doi.org/10.1093/rof/rfag016

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