Empirical Study Of Chinese Stocks Repurchase Effect

With the opening up in the Chinese market, Chinese stocks facing unprecedented development, By of the December2011, more than228Chinese companies listed in the U.S..In early2011, the short-seller Muddy Waters in the U.S. market make a research report on China Media Express Holdings, Inc, which questioning the company deliberately exaggerating the profitability, causing stocks into a credibility crisis and share prices fell sharply. By of the end of2011, there is a total of26Chinese companies delisted from the three major U.S. markets. Represented by taobao, NetQin, Dangdang, Sohu companies are used to repurchase their own shares, facing the seriously undervalued stocks. By of December2,2011, a total of64china concept stocks successively launched69stock repurchase, disclosing the amount totaled$3.04billion. How is the effect of the China concept stock buy-back? Whether can improve the market confidence, and to improve the company’s share price? This is all the problems for study in this paper.This paper mainly uses the empirical analysis and descriptive statistical analysis, by establishing the econometric model based on the price of Chinese stocks, selecting the repurchase stocks during2011to2012to study the effect of the Chinese stocks repurchase.This paper is divided into five chapters. The first chapter is an introduction. It is mainly to explain the background, Theoretical review, significance, the main content, research ideas, and innovation of this article. The second chapter is the stock repurchase theoretical. First of all, it introduces the connotation of stock repurchase and the legal demarcation; and then it introduces the ways and effects of stock repurchase; the last it introduces the stock repurchase motivations. The third chapter is the study on design method. First, the study makes a hypothesis, and then it introduces the event study method amply, finally, this paper establishes the last step of the study. The fourth chapter is the process of the empirical analysis. This chapter is the main part of this paper, first, it studies the Chinese stocks repurchase effect based on Chinese stocks share price movements of a descriptive and make preliminary conclusions; second, Second, it is based on the empirical analysis of price change and think that the wealth effect of china concept stocks repurchase was not significant; Finally, it is for the buyback companies operating efficiency before and after the comparative analysis and think the company management benefit effect of Chinese stocks repurchase is not significant. The fifth chapter is conclusion and prospect. The conclusion of this paper is that Chinese stocks repurchase effect is poor, the reason may be that Chinese companies to stock repurchases, did not improve the company’s operating performance, boost market confidence. Based on this conclusion, the paper puts forward three research enlightenment:Company’s management should take the initiative to disclose relevant financial data, in order to enhance the company’s operating performance, enhance market confidence; Investors should be rational treat Chinese stocks repurchase, careful investment; Regulators should require to strengthen information disclosure of listed companies, to effectively protect the interests of investors.