Research On The Influence Of Cash Dividend Policy On Stock Price Crash Risk Of Main Board Listed Company

Less than ten years since 2008,China's security market has twice experienced serious crash,resulting thousands of investors suffering huge losses.Although there may be lots of factors attributing to the crashes,it is undeniable that participants of China's security market are highly speculative,lack of the sense of long-term investment and value investment,which is also one of the important reasons of stock price crash.In the past years,scholars try to use signaling theory and agency cost theory to explain the relationship between cash dividend and the changes of stock price.However,most of them paid close attention to the short-term reaction of stock market,instead of the long-term influences caused by cash dividend.What's more,there are few scholars studying on the relationship between cash dividend policy and stock price crash risk straightly.For listed companies,the cash dividend policy is one of the most important means to return investors,as well as to deliver important information to the market.Therefore,the regulators have been always paying great attention to the cash dividend policy,and the proportion of the cash dividend distribution of listed companies has become a necessary condition for refinancing.Through years of regulatory policy guidance,the level of dividend payout of listed companies in China has increased significantly.As of the end of 2015,nearly 80%of the listed companies use cash dividend as a way of distribution of profits.The annual average cash dividend per share and payout ratio is basically stable at 0.15 yuan per share and 40%.However,it is still a question to be discussed whether the positive cash dividend policy has a positive impact on the stock price and reduces the risk of crash.Based on the above facts,this paper uses 3895 company-year data from 2012-2016 as a study sample,selects NCSKEW and DUVOL as a proxy measure of stock crash risk,and does empirical test of the relationship between cash dividend per shareand stock price crash risk with a fixed effect model.The empirical results show that:there is a significantly positive correlation between cash dividend per share and stock price crash risk.At the same time,compared to the low dividend payout ratio of listed companies,companies with high dividend payout ratio have a stronger positive correlation between cash dividend per share and stock price crash risk.This result means that the cash dividend policy sometimes reflects not all shareholders,but the interests of large shareholders,especially for large shareholders holding large number of non tradable shares.The cash dividend policy is likely to become a tunnel to grab cash.Aiming at the problems found in empirical study,this paper puts forward the corresponding policy recommendations from the following three aspects:first,to fully consider the individual differences among listed companies,to further refine the"difference of dividends";second,to further strengthen the protection mechanism of the interests of small investors;third,to improve the corporate governance structure,to encourage institutional investors to participate in corporate governance and to promote the management layer to hold stock.