Junior Equity Market Regulation In Canada And Around The World [Podcast]

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Junior Equity Market Regulation In Canada And Around The World (Podcast) by Pat Light

Market regulation is a hot-button topic at the best of times, and the economic effects of specific regulations are very rarely completely understood. J. Ari Pandes and Michael J. Robinson, CFA, looked into market regulation for an article in the July/August 2014 issue of the Financial Analysts Journal, “Is Effective Junior Equity Market Regulation Possible?” Pandes and Robinson examined Canada’s Capital Pool Company (CPC) program, a regulated blind pool program. We talked with Robinson about the research he and Pandes conducted, as part of our FAJ Author Interview Series.

Robinson said that “there’s been a decline in the number of IPOs . . . around the world,” and he and Pandes wanted to investigate whether the Canadian approach to the problem could be applied globally. He said they analyzed the CPC program, which started in 1986 after a period in which Canadian companies were having trouble raising capital.

Pandes and Robinson looked at three main questions regarding the CPC:

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  1. Did the CPC regulations lower the amount of fraud?
  2. Did the quality of the firms going public increase after the regulations were put in place?
  3. Did the success of the firms listed through the CPC program increase?

To hear Robinson’s thoughts on the study’s outcomes, listen to the interview above or download the MP3.

CFA Institute members can read the full article on the Publications website.

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This was previously published on Enterprising Investor at the CFA Institute.
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Pat Light is an assistant editor at CFA Institute. Before joining the CFA Institute editorial staff, he worked as a teacher. Light has a BA in English from Duke University.

Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.

 

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