INVESTOR SENTIMENT AND POST-IPO PERFORMANCE IN CHINA'S CHINEXT MARKET
DOI:
https://doi.org/10.35631/AIJBES.828007Keywords:
Behavioral Finance, IPO Performance, Investor Sentiment, Natural Language ProcessingAbstract
Post-IPO performance remains a persistent anomaly in financial markets, particularly in emerging economies characterized by high retail investor participation. This study proposes to assess whether investor sentiment at the time of issuance predicts short, medium, and long-term post-IPO performance for firms listed on China’s ChiNext board. Using a multidimensional sentiment measure that integrates market-based indicators with textual sentiment extracted from investor-generated online discourse, the analysis will capture both trading-driven and narrative-based components of collective mood. Empirical results is expected to show that elevated investor sentiment significantly amplifies IPO initial returns and is associated with subsequent return reversals over one to three year horizons. High-sentiment issuance periods are also expected to be linked to increased post-listing volatility, suggesting that sentiment driven demand contributes to both mispricing and risk amplification. By providing board-specific evidence from a retail-dominated emerging market, this study is expected to advance behavioral asset pricing research and highlights the structural conditions under which sentiment-driven IPO mispricing is most likely to arise and persist. The expected results offer implications for market stability, investor protection, and the evaluation of pricing efficiency in growth-oriented equity segments.
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