Role of Primary Market Securities

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Primary Market: Sustainability and Sector Specialty on Major Stock Exchanges

Listing on Deutsche Börse: More to it Than You Might Imagine Choosing the best stock exchange to list on is a complex process. It needs careful thought and is something that should be based on hard facts. This is a summary based on information found in a recent study1) by Professors Christoph Kaserer and Dirk Schiereck. These academics, recognized as experts in the field of finance, examined many of the different aspects which need to be considered when listing. The main criteria they identified are: Flotation costs, liquidity, primary market activity, sector familiarity, the development of investor confidence based on the longer-term success of new issues, and the ability for companies to develop and move up to the main markets. The study, which is the third such detailed analysis made by Professors Kaserer and Schiereck, makes a full comparison based on nearly 2,700 new issues between January 1999 and March 2008 of the separate advantages of listing on Europe’s three major stock exchanges, Deutsche Börse, Euronext and the London Stock Exchange (LSE), as well as Hong Kong Stock Exchange (HKSE), National Association of Securities Dealers Automated Quotations (NASDAQ) and the New York Stock Exchange (NYSE). The results show just how varied the performance of different primary markets is. They also confirm the real and tangible benefits of listing on Deutsche Börse. It is often reported that the LSE is Europe’s most active market for initial public offerings (IPOs). However, when it comes to the hard facts about IPOs and issue volume, Euronext and Deutsche Börse are closer behind the LSE than many people realize. When looking at the percentage of IPOs relative to all new issues, Deutsche Börse is actually the most frequently chosen marketplace for IPOs. Deutsche Börse’s Entry Standard segment is the leading and most active marketplace for IPOs taking place on the alternative (more junior)...