A Review on IPO Underpricing

The theory of initial public offerings(IPOs) focus on three abnormal phenomena: IPO underpricing,long run underperformance of IPO,and hot issue markets.These three long-standing phenomena are conflicted with the EMH widely,which attracted attention from economists all over the world.The IPO underpricing is the emphasis out of the three.It is important to research on IPO underpricing academicly and practically.