Research On The Wealth Effect Of Share Repurchase In Chinese Listed Corporations

Share repurchase is a common capital operating method in the west capital market, which is a way to reduce capital and adjust the equity structure of listed corporations through buying back it's own stock. As a way of equity contraction, share repurchase involves capital structure and dividend policies of listed corporations thus it can improve their internal stock value. In China, with the development of the security market, Share repurchase is recognized by more and more listed corporations and some of them have utilized this capital operating method. We can discover from the history records that listed corporations have made active attempt and exploration in stock repurchase—from the early period of state-owned stock repurchase to recent stock repurchase from open market. Therefore, studying related theories and practice on share repurchase of listed corporations has active meaning, which promotes the development and innovation of our capital market and listed corporations.The thesis is divided into four chapters. In chapter one, notions and classifications of share repurchase were introduced as well as current researches, and then the emphasis of the study was given. In chapter two, the basic theories on share repurchase were introduced in order to explore the intrinsic motivations and the internal mechanism of shareholders' wealth creation of the share repurchase. In chapter three, the financial aspect of stock repurchases is discussed. The model of wealth effect of stock repurchases is introduced. The wealth effect of stated-owned stock repurchase and open market stock repurchase was analyzed by using method of event research. In chapter four, the problems in stock repurchase were generalized and some related suggestions to resolve these problems were put forward.