Three Decades of IPO Markets in Canada: Evolution, Risk and Return
Bibliographic record
Abstract
In Canada, initial public offerings (IPOs) have decreased sharply over the past twenty years, inducing potentially substantial negative effects on the economy. The reasons for this decrease are controversial. To contribute to the debate, we analyze the Canadian IPO market over three decades (1986-2016). First we illustrate its specificities using IPOs on the main and the venture stock exchanges and using other junior markets a benchmark. We discuss the evolution of the IPOs, which differs considerably between natural resource and non-natural resource firms. We then provide empirical evidence based on 2, 145 Canadian IPOs. On average, these IPOs generate three-year negative abnormal returns, and more than 70% report negative abnormal returns. Large issuers reporting profits constitute the only subsample that provides fair returns, but they account for less than 5% of IPOs. We observe a high level of skewness of abnormal returns, consistent with the behavioral finance proposition that investors are often unduly optimistic when valuing lottery stocks. The lemon market characteristics of the Canadian IPO market can probably explain why it is vanishing.
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How this classification was reachedexpand
Full frame machine prediction
Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.
Distilled classifier scores by category (both heads)
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.001 | 0.005 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.000 | 0.000 |
| Bibliometrics | 0.004 | 0.007 |
| Science and technology studies | 0.002 | 0.001 |
| Scholarly communication | 0.004 | 0.001 |
| Open science | 0.001 | 0.001 |
| Research integrity | 0.001 | 0.001 |
| Insufficient payload (model declined to judge) | 0.002 | 0.000 |
Machine scores (provisional)
The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.
Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.
How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".