Research On The Economic Consequences Of Senior Managers' Stocks Adding And Reducing

Despite the sluggish world economy in the past ten years,China's average GDP growth rate of 9.56%,economic growth has become one of the main engine of the world economic and trade development.Listed companies are the main force of China's economy.After the accomplishment of stock split reform,the establishment of GEM and small and medium-sized board market,its overall quality and sustainable development etc are in a benign development.However,in the full circulation period of China's stock market in the past ten years has continued to slump,only in the first half of 2015 appeared in the bull market.In the capital market,frequent insiders trading behavior has exacerbated the volatility of stock market,because of the information superiority,executives' behavior of increasing or decreasing has also become a popular topic.During the period from 2013 to 2016,through the analysis of the current status of the increase and reduction of senior executives,it was found that the increase and reduction of senior executives were bigger and more varied during this period.And this period contains a complete process of the stock market change,not only the change of the bull and bear market,but also the stable period of the stock market,which is very representative.Based on the existing academic literature,executives in the obvious information dominance in the business process.At this time what economic consequences will occur afterthe increase and reduction of senior executives,whether it can be seen as a signal to the future performance of company? And how does the market respond to the behavior of senior executives? This paper,from two aspects to explore the economic consequences of senior executives' increasing or decreasing behavior.The main problems of this paper are as follows: the market effect of increasing or decreasing the behavior of senior executives;the trend of long-term financial performance of the company after the increase and reduction of the behavior of the senior executives.Firstly,this paper defines the research object,theoretical basis and brief introduction of this article;and then with the help of previous literature and reality to preliminary identified the research ideas;after the related theory and the assumptions of this article.The market reaction used the event study.All the listed companies which had executives of change in holding behavior of A-shares in the 2013 to 2016 used this method.The reduction of executives will make the market negative reaction,executives holdings will cause the market positive reaction,and further analyses in the bull market,the reduction of executives as usual and will not affect the company's share price,the company's overall price is still the rise;in the bear market environment,will enhance the company's holdings of executives for short-term performance,but only moderate declines.According to thelong-term performance of this article uses the multiple regression method,using 18 financial indexes by the principal component analysis method to determine the comprehensive financial performance,the proportion of holdings of executives is inverted "U" shape trend of the impact on the financial performance of the listed companies,and the reduction of executives have no obvious effect on the company's long-term financial performance.Finally,according to the research conclusions to offer the feasibility suggestions.