Abstract

Purpose – this study aims to investigate how those directors of listed companies to make profits when their firms were listed to public.

Design/methodology/approach –This is an empirical study; we adopted the formula from Ritter (2001) for this research.

Findings -this study finds that directors of issuing companies usually get benefits from the money left on the table due to two factors. First, they usually retain larger percentage of shares before or after the companies going public; second, the first-day closing market price is normally higher than the initial file price ranges (defined as the expected price per share by issuing companies just before the firms go public). Originality/value - the findings may be used for future academic research literatures which focus on IPO or primary market. This research would help individual investors better understanding primary market especially IPO market.

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