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The Issue Decision of Manager‐Owners under Information Asymmetry

Publication ,  Journal Article
BRADFORD, WD
Published in: The Journal of Finance
January 1, 1987

A firm must issue common stock in order to undertake a new investment, and the firm's manager‐owners can value the firm more accurately than the market. The ability of the manager‐owners to trade in the firm's shares during the issue (a) reduces the investments that are foregone because of the market's mispricing the firm's shares, (b) changes the size and direction of the stock price change when the firm announces a new stock issue, and (c) changes the market value of the firm before and after the issue announcement, whether or not it decides to issue. 1987 The American Finance Association

Duke Scholars

Published In

The Journal of Finance

DOI

EISSN

1540-6261

ISSN

0022-1082

Publication Date

January 1, 1987

Volume

42

Issue

5

Start / End Page

1245 / 1260

Related Subject Headings

  • Finance
  • 1502 Banking, Finance and Investment
 

Citation

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BRADFORD, W. D. (1987). The Issue Decision of Manager‐Owners under Information Asymmetry. The Journal of Finance, 42(5), 1245–1260. https://doi.org/10.1111/j.1540-6261.1987.tb04364.x
BRADFORD, W. D. “The Issue Decision of Manager‐Owners under Information Asymmetry.” The Journal of Finance 42, no. 5 (January 1, 1987): 1245–60. https://doi.org/10.1111/j.1540-6261.1987.tb04364.x.
BRADFORD WD. The Issue Decision of Manager‐Owners under Information Asymmetry. The Journal of Finance. 1987 Jan 1;42(5):1245–60.
BRADFORD, W. D. “The Issue Decision of Manager‐Owners under Information Asymmetry.” The Journal of Finance, vol. 42, no. 5, Jan. 1987, pp. 1245–60. Scopus, doi:10.1111/j.1540-6261.1987.tb04364.x.
BRADFORD WD. The Issue Decision of Manager‐Owners under Information Asymmetry. The Journal of Finance. 1987 Jan 1;42(5):1245–1260.
Journal cover image

Published In

The Journal of Finance

DOI

EISSN

1540-6261

ISSN

0022-1082

Publication Date

January 1, 1987

Volume

42

Issue

5

Start / End Page

1245 / 1260

Related Subject Headings

  • Finance
  • 1502 Banking, Finance and Investment