Who expend resources to ensure that y only buy ipos

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Q. Asymmetric Information Rock (1986) proposed one of first stories explaining under pricing. He suggested that stocks are underpriced because of information asymmetries between different classes of investors. He these aggregated investors into informed investors (like institutional investors) who expend resources to ensure that y only buy IPOs that will yield positive returns over time and uninformed investors who buy stock indiscriminately and without information (Rock, 1986, p. 190). Could IPOs Be Lemons?

Reference no: EM1369461

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