The Empirical Research On The Lagged Effect Of The Total Asset Growth On The Excess Stock Returns

It generally believes that the total assets growth can cause the accounting income growth. The income growth has represented the enterprise value growth; therefore the stock price will grow with it. However, more and more research in American discovered that activity related with the property expedition, usually following with a low repayment time. However, the activity related with the property contraction often following close on an unusual high repayment time. In our country, it also has the similar phenomenon. For example, the Lenovo purchases the PC service of IBM, Shanghai Volkswagen purchases SsangYong, Eddia and Delong collapses after the rapid expansion, is transmitting the similar information:The property blind expansion is hiding the huge crisis. This article research the influence of the total assets grows to the exceeding the quota stock income. It will provide some references to the enterprise superintendents carry on decision about the expanding or the contraction of asset.And it also provide some references to the exterior investor carries on the choice of the investment portfolios.In order to make sure the period of the influence on the growth of total assets. First, we test the lagged effect of the total asset growth on the enterprise achievement by stages. Based on this we constructed the diagnosis model of this test. We use the FM return method to carry on the analysis, and has carried on the related examination to the model. This article synthesis utilized many kinds of models to select the crucial ratio factors to the influence of stock returns. And carries on the real diagnosis with our country's data. Especially has carried on the thorough analysis to total assets rate and carry on the test by stages to the possible lagged effect. We find that:First, the influence of the total assets rate this year to the business income will continue to the fourth issue (lagged three issues).Second, the influence of the total assets rate this year to the net profit of the fourth year is most remarkable, but the influence is not remarkable to other years. Third, the total assets rate Lagged three years has a remarkable relation to the stock returns ratio which is exceeding the quota. Fouth, the stock returns ratio is very sensitive to the total assets rate Lagged three years. Fifth, the Interactive variable of the total assets rate Lagged three year and account market value has remarkable inverse correlation with excess stock returns ratio.We proposed that:First, the influence of the stock returns is very much. This article has introduced total assets rate in domestic and has carried on the empirical analysis using our country's data. Second, this text carried on lagged effect research on the total assets to enterprise achievement, and carried on to the possible lagged effect has tested by stages. Based on this and we has constructed model to exam the lagged effect on the total asset growth to the excess stock returns ratio. The research confirmed the supposition that the total assets rate Lagged three years has a remarkable relation to the stock returns ratio.