An Empirical Analysis Of IPO Volumes' Fluctuation

IPO volume fluctuates substantially over time. The article carries out research on the basis of Chinese A-share stock market data over 14 years and aims to find out factors that lead to this kind of fluctuation. By analyzing these factors, the article employs several hypothesizes and reaches out conclusions in the end following empirical tests.The first step of the article is to conceive of the 3 factors which influence IPOs: the first factor is firms'demand for capital, i.e. capital demand. The second is information asymmetry between potential investors and internal management. The third is investor sentiment. On further analysis we get 5 hypothesizes for empirical research: IPOs positively relate with GDP, total society fixed asset investment, stock exchange volumes, negatively with first day abnormal return rate and stock exchange amount.The article uses time-series analysis and employs an independent variable: IPOs of each month. As to dependent variables, we abstract from macroeconomic indexes such as GDP, total society fixed asset investment and microeconomic indexes: IPO offer price, first day close price, annual return rate, stock exchange volumes and stock exchange amount. The article also employs a control parameter: a dummy variable. The empirical research finds that IPOs positively relate with GDP, total society fixed asset investment, stock exchange volumes and first day abnormal return rate, and negatively relate with stock exchange amount without significance in statistics.The article comprises of 4 parts which arranges as follows: the preface generalize fluctuations of IPOs and introduces aims of the whole text. The first part introduces background. In this part, we review researches that have been made and bring forward frameworks the paper would carry out. The second part is theoretical basis. We analyze and conclude 3 factors which lead to hot issue market: capital demand, information asymmetry, investor sentiment. The third part of the paper is the entire empirical test, Included 8 steps: study object, study purpose, time period, sample selection, hypothesis, variables design, data source and means, empirical process and analysis. The test chooses Chinese A share data as study object and companies, which have been listed on Shanghai and Shenzhen Stock Exchange, as samples. The last part of the paper conducts a conclusion for the whole test, points out study limitations that exist and suggestions for future research as well.