Empirical Study About The Factors Affecting The Reduction Behavior After The Non-tradable Shares Lifted

As the characteristic of Chinese Capital Market, the Split-share Structure Reform has been affecting the development of the stock market. In fact, the expiration of up-locked shares and the selling of the shareholders make a great influence on Chinese Capital Market, and have drawn attention of scholars and practitioner.This article try to find the factors which affect the behavior of the up-locked shareholders. By literature review, the article finds the factors affecting the behavior of up-locked shareholders can be divided into five aspects, that is, ownership, macroeconomic, market trends, valuation and financial performance. The article takes Shanghai and Shenzhen 300 Index constituent stocks as the sample, and choose the ratio of the number of the stocks selling as the dependent variable, and choose Herfindahl₁0 Index, The growth rate of GDP, Tobin’s Q, PE ratio, equity ratio, return on equity, stock volatility, Beta, the board size and the ratio of independent directors as independent variables. At the same time, we choose classification of industry and classification of stock plates as control variables. We apply multiple linear regression model to our data, to find the factors which affect the selling of up-locked stockholders.After data processing and analysis, we find that Herfindahl₁0 Index, the growth rate of GDP, Tobin’s Q, equity ratio, stock volatility, beta and the board size has significant impact on the behavior of up-locked stockholders. And there is no indication that, PE ratio, return on equity and the ratio of independent directors have impact on the selling of up-locked stocks. We hold the views that when the stocks are overrated, or the stock volatility is large, the up-locked stockholders tend to sell their stocks which are expired. They seldom take the financial performance of the companies into consideration. The ownership of the companies has influence on their behavior as well. We think there is speculation, and the investors should be more rational. At the same time the regulators should enhance the supervision on up-locked stockholders.