1 Multilisting – hvad er værdien for virksomheder og investorer?

Abstrakt

This thesis focuses on the multi-listing of shares. In this global world, both the companies and the investors are looking abroad, to find new and better ways to do business. There are basically two possibilities to multilist: dual-listing and cross-listing. Dual-listing will only follow an international merger, where the company keep a headquarter in both countries. A Dual-listed share is listed on two exchanges in two different countries, and even though the two shares represent claims on the same cash-flows, it is not possible to convert the one share into the other. A Cross-listed share, on the other hand, is listed by one company who wishes to expand to a new market. These shares, it is in most cases possible to convert between each other. The most common way to cross-list is by issuing an ADR – American Depositary Receipt. When the companies seek to new markets to list their shares, they are facing both advantages and obstacles. Some of the advantages are the possibility to raise capital on the new market, higher return to shareholders and higher credibility. On the other hand there will be demands to obey more legislations and the liquidity of the shares can be impacted. The investor will have more opportunities to select the best portfolio, when the ranges of securities are expanded. In some cases the investor will now have all information in his or hers own language, and do not have to be an expert in the rules and legislation to trade in an emerging market to invest here, but can choose a cross-listed security instead. Basically there should be no differences in the prices of the shares traded on different exchanges. I have analyzed over a million empirical data’s and in the very most cases the shares are priced efficiently. But in some cases there seems to be arbitrage possibilities, also after various costs are taken into consideration. I have also analyzed, how large the influence from the foreign exchange rate are, both on the return and on the variance. And not surprisingly the contribution can be very large. Even though the variances on the exchange rates in most cases are 10 times smaller than the variance on the security, it sometimes contributes with 66% of the total variance. In the same way the contribution to the return can also be substantial. To see the result of the combined factor of the contribution from the exchange rate on the variance and return, I have calculated the reward-to-variability. And here the result is ambiguous. For an American it doesn’t really matter if he invests domestic or abroad, but for other investors the decision matters.