The Analysis Of Participation Of Different Types Of Investor To The Private Placement Announcement Effects

Private placement is defined as the operation that additional stocks of listed companies are issued to few specific investors. Private placement has been a popular financing model since issuance of ?Regulations of listed companies' securities issuance?. At present, theoretical researches of private placement mainly concentrate on aspects such as announcement effect (short-term rate of abnormal return), substantial shareholders'tunneling phenomenon and issuing pricing. But comparatively, less researches focus on long-term rate of abnormal return due to the limitation of sample data. The good news is we have meet the requirements of study concerning long-term rate of abnormal return of private placement with the growth of Chinese capital market and further practice in private placement. This dissertation analyses both short-term and long-term abnormal return during and after private placement, especially the long-term one.The dissertation contains three parts:1. Theoretical analysis about the effects on stock prices by private placement in both Chinese and foreign markets. Generally, several elements are included such as monitoring effect, asymmetric information effect, management entrenchment effect, hypothesis about shareholders'supervision, hypothesis about windows of opportunity and growth opportunity; 2. Analysis on the private placement announcement effects of different types of investors to participate in the analysis; 3. Analysis on announcement effect and long-term rate of abnormal return after private placement based on the sample data including listed companies which had operated private placement in A stock market during 1st January 2011 to 31th December 2013.Conclusively, this research reveals that:1)The existence of positive effect from private placement.2)The announcement effect would be undermined since the participation of the Institutional investors.3) The numerical value of long-term rate of abnormal return is negative which shows that the investors are overoptimistic and the listed companies who have operated private placement are overvalued.4) The long-term rate of abnormal return is considerable if control shareholders participate in the private placement.