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Managerial optimism and post-financing stock performance in Taiwan: A comparison of debt and equity financing

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  • Wang, Chih-Yung
  • Chen, Yu-Fen
  • Yu, Chia-Wen

Abstract

We compare post-financing stock performance for debt-issuing portfolio with equity-issuing one in Taiwan to identify whether firms’ financing decisions were driven by managerial optimism or market timing. Our result supports corporate financing decisions in Taiwan are driven by managerial optimism.

Suggested Citation

  • Wang, Chih-Yung & Chen, Yu-Fen & Yu, Chia-Wen, 2013. "Managerial optimism and post-financing stock performance in Taiwan: A comparison of debt and equity financing," Economics Letters, Elsevier, vol. 119(3), pages 332-335.
    • Handle: RePEc:eee:ecolet:v:119:y:2013:i:3:p:332-335
    DOI: 10.1016/j.econlet.2013.03.010
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    References listed on IDEAS

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    Cited by:

    1. Irene Wei Kiong Ting & Hooi Hooi Lean & Qian Long Kweh & Noor Azlinna Azizan, 2016. "Managerial overconfidence, government intervention and corporate financing decision," International Journal of Managerial Finance, Emerald Group Publishing Limited, vol. 12(1), pages 4-24, February.
    2. Yang, Mian & Tang, Wenliang, 2022. "Air pollution, political costs, and earnings management," Emerging Markets Review, Elsevier, vol. 51(PA).
    3. Hemmings, Danial & Hodgkinson, Lynn & Wang, Qingwei, 2018. "Heterogeneous effects of the SEC’s Securities Offering Reform," Economics Letters, Elsevier, vol. 170(C), pages 131-135.

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    More about this item

    Keywords

    Managerial optimism; Market timing; Financing decisions;
    All these keywords.

    JEL classification:

    • G02 - Financial Economics - - General - - - Behavioral Finance: Underlying Principles
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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