High praise: Assoc Profs Glen Holman (right) and Carlos Correia of the Department of Accounting in the Faculty of Commerce have won the Standard Bank prize for best paper of the year in the SA Journal of Accounting Research for 2008.

UCT's Associate Professors Carlos Correia and Glen Holman of the Department of Accounting in the Faculty of Commerce have won the Standard Bank prize for best paper of the year in the SA Journal of Accounting Research for 2008.

Their paper is titled An analysis of underpricing and aftermarket performance of initial public offerings on the Alternative Exchange (AltX). The prize carries a purse of R10 000.

The original research also attracted high praise when it was first presented. The pair won the PricewaterhouseCoopersBest Paper Award for this research at the Biennial South African Accounting Association (SAAA) Conference in Johannesburg last year.

The paper analysed aftermarket performance of Initial Public Offerings on the AltX, from inception in 2003 until October 2007. The study found that investors would have earned a non-risk-adjusted cumulative return of 44% higher than the market benchmark, based on the opening issue price. However, once the first-day return is excluded (which was mostly only available to financial institutions and hedge funds), investors would have earned a non-risk-adjusted cumulative return of only 6% higher than the ALSI market benchmark.