RT Journal Article
SR Electronic
T1 Drivebys Systematically Underperform
JF The Journal of Portfolio Management
FD Institutional Investor Journals
SP 86
OP 90
DO 10.3905/jpm.2005.570154
VO 31
IS 4
A1 Martin S Fridson
A1 Greg Braylovskiy
YR 2005
UL https://pm-research.com/content/31/4/86.abstract
AB Unlike traditional high-yield bond offerings, which typically entail a two-week roadshow of presentations to prospective investors, driveby offerings are announced and priced within one day. The yield spread of the average driveby deal widens versus the high-yield index in the first week and the first four weeks after issuance, while the spread of the average non-driveby deal tightens. This finding is statistically robust. Drivebys tend to come to market when the pressure to invest surplus cash is greatest. Portfolio managers who can hold out generally have an opportunity to buy the issues more cheaply in the secondary market.