| Summary: | One of the most phenomena at Initial Public Offering is underpricing. Many
theory have explained it, and many reseacher have examined the theory of
underpricing. One of the most theory that have explained the phenomena of
underpricing is asymmetry information. In this thesis, asymmetry information will
be examined by signals that emerged due to the existing of asymmetry
information condition. Several signals that used in this research, only financial
leverage that affected underpricing consistenly, either in standardized
underpricing model or unstandardized underpricing model. Thereafter, the second
phenomena at Initial Public Offering is the declining performance of underpriced
stocks. In this thesis found that in the longtime, three years later, the performance
of underpriced stocks will be decline sistematically. Longterm performace
examined by CAR and BHAR methods.
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