| Short-term underpricing and long-term underperformance are anomaly in Initial Public Offerings (IPO) that have been widely observed across different stock markets and time periods. This study is focused to know the differences between short-term underpricing and long-term underperformance in the hot and cold market. The statistic method that is used to analyze the differences is Mann Whitney (U Test). The subject of this study is listed companies on the Indonesia Stock Exchange from the period of 2001 – 2011 with stock prices data coverage from the period of 2001 – 2014. With average first-day return and MAAR method, it is concluded that there is a significant difference in the short-term underpricing where the underpricing level in the hot market is higher than in the cold market. With Wealth Relative (WR) method, it is concluded that the IPO stocks in hot and cold market are both having long-term underperformance (WR index < 1). However, IPO stocks performance in the hot market is not as bad as in than in the cold market. This result is inconsistent with the hypothesis that said the higher the underpricing, the poorer the performance of IPO stocks in the longer term. |