Analysis Of High Stock Dividend Behavior Of GEM Companies

After the Growth Enterprise Market(GEM)established on October 23,2009 at the Shenzhen Stock Exchange,its feature of high stock dividend made it once outshine the main board market,which has become the media and investors competing enthusiastically topic.However,with the past two years' giving and transforming 10 shares of each 10 stocks becoming a standard layout,the company's motivation of implementing high stock dividend policy is no longer pure.As the investors who always pursuit of high bonus shares in this time should not only learn to observe characteristics of high stock dividend companies to hold the investment opportunity,but also should know how to judge the value of equity investments.It requires the investors to analyze the achievements,share price,share capital,as well as the reduction and increasing issuance policy of the high stock dividend companies in advance to realize the real business motivations and intentions of them to make the right investment decisions.This paper takes three companies for example,whose turnover and volume ranked in the top 20 of the GEM active stocks during a three consecutive years from 2013 to 2015.By comparative analysis and statistical description of the business case(Letv,Ultrapower,China NetCenter),this paper analyzes the characteristics and motivations of the high stock dividend behavioral,it also analyzes the high stock dividend effects of investors and business effect through event study method.It concludes that high stock dividend behavior is often accompanied by high-performance,high stock price,small capital,reduction or issuance policy,the corresponding purposes are to pass the good news,increase stock liquidity,enlarge share capital,reduce shares on higher prices and tax avoidance.Different periods of high stock dividend window have different impact on stock prices,while corporate investors have price hallucinations on companies' high stock dividend,heightened price is the nominal price,then the actual value distributed to the hands of investors is unchanged.At last,the paper gives proposals to the high stock dividend companies,investors and regulators on the basis of the study conclusions.