Equity Refinancing The Performance Of Institutional Investors Is Better Than The Market: An Empirical Study Of The Chinese Market

This paper examines the relationship between institutional shareholding change around SEOs and the post-issue market performance of SEO issuers in China market, in extension of Gibson's research (2004) in the Unities States. There is evidence that the SEO issuers experiencing the greatest increase in institutional shareholding around the offer date have significantly better performance relative to those experiencing the greatest decrease, within two quarters after the offer. However, there appears to be a price reversal in the mid-long term.In this study, the relationship of specific company attributes and institutional shareholding change is also examined, and the results show that China's institutional investors tend to buy stocks with lower PE ratio around the SEO issue and improve their PE ratio through trading.This paper may be some reference for other kinds of investors.