Journal of Financial and Quantitative Analysis Vol. 59 No. 4 2024

ETF Ownership and Seasoned Equity Offerings

Kevin Evans¹; Woon Sau Leung²; Junqiu Li¹; Khelifa Mazouz¹

¹ Cardiff University · ² University of Edinburgh

Abstract

This article investigates the impact of exchange-traded fund (ETF) ownership on seasoned equity offerings (SEOs). We find that increases to firms’ ETF ownership is positively related to their propensity to conduct an SEO. ETF ownership is also associated with less negative SEO announcement returns, smaller discounts, and better long-run stock returns. Our evidence is consistent with equity issuance following investor demand for stocks driven by greater participation in ETFs, suggesting a possible alternative source of market timing opportunity.

DOI

10.1017/s002210902300042x

Volume

59

Issue

4

Pages

1821-1848

Language

en

Sources

bibtex:phds-export.bib crossref openalex

Cite

APA 7 MLA 9 Chicago (author–date) Harvard Elsevier Harvard (JFE, JBF…) The Accounting Review Academy of Management American Marketing Association INFORMS (Management Science) Copy citation Copied ✓