Journal of Economics and Finance

, Volume 29, Issue 1, pp 32–45

The 180-day lock-up period and insiders’ equity selling


DOI: 10.1007/BF02761541

Cite this article as:
Ayayi, A. J Econ Finan (2005) 29: 32. doi:10.1007/BF02761541


This article examines how insiders who provide capital and advisory services determine the proportion of common stock to be sold during an IPO and shows that, after the IPO, a high-value investee's insiders continue to hold a significant fraction of its equity stake relative to a low-value investee's insiders. The result is consistent with the signaling of the insider trader reputation, the lock-up argument, and the only least-cost separating equilibrium that survives the intuitive criterion.

Copyright information

© Springer 2005

Authors and Affiliations

  1. 1.School of Business ManagementRyerson UniversityTorontoCanada