A Research On The Impact Of Cash Dividend Policy On Investment Behaviors Of Institutional Investors

As important participants in the capital market,institutional investors have been highly valued by market participants and regulators.Because of the rapid development strategy of institutional investors,institutional investors have taken place great changes in proportion,type and quantity.According to the financial report by mid-2017,institutional investor's shareholding ratio was 45.09%,institutional investors gradually dominate the stock market.The behavior of institutional investors deeply affects the development of securities market.Relative to individual investors,institutional investors are generally regarded as having more information channels and more professional analytical skills.Institutional investors have a big impact on the companies they invest in.Listed companies also generally hope to improve corporate governance through the professional advantages of institutional investors and get more investors' attention.Meanwhile,cash dividend policy is one of the three financial decisions.It has a deep impact on investors' returns and the company's future development.Compared with other mature capital markets,Chinese listed companies pay little attention to the distribution of cash dividends.This phenomenon also has a significant impact on investors' investment behavior.Therefore,it is of great practical significance to deeply study the effect of cash dividend policy on the investment behavior of institutional investors.The main content of this article is as follows.First,this paper reviews the dividend theory related to investors' preference.I have learned the research results of relevant literatures.Second,this paper reviews the development of cash dividend policy and institutional investors of listed companies in China and introduces their current situation.Third,this paper applies the data of listed companies from 2008 to 2016 and empirically tests the influence of the cash dividend policy of listed companies on the investment behavior of institutional investors.The paper analyzes the cash dividend preference of investors from three dimensions: shareholding ratio,type and quantity.Four,combined with empirical analysis and dividend theory,this paper analyzes the reasons why Chinese listed companies do not attach importance to cash dividend policy.Finally,this paper puts forward some specific policy suggestions based on previous research.The main content of this article is as follows.First,the cash dividend policy of listed companies can significantly improve the shareholding ratio of institutional investors in the next issue.And the higher the level of cash dividend payments,the higher the shareholding ratio of institutional investors.Institutional investors generally prefer cash dividends.Second,the listed companies that issue cash dividends have more types of institutional investors.The higher the cash dividend per share,the more variety of institutional investors.Various types of institutional investors focus on the cash dividend policy.Third,the cash dividend policy of listed companies can significantly improve the number of long-term institutional investors.The higher the level of cash dividend payments,the more long-term institutional investors.Four,short-term institutional investors prefer companies that issue cash dividends.But there is no correlation between the level of cash dividend payment and the number of short-term institutional investors.Short-term institutional investors follow the "prudent rule" when building portfolios and regard the cash dividend policy of listed companies as an important reference standard.Short-term institutional investors try to avoid investing in companies that do not pay cash dividends.Meanwhile,short-term institutional investors do not value cash dividends,preferring capital gains.The first innovation point of this paper is to study the relationship between the cash dividend policy and the diversification of institutional investors in listed companies.The second innovative point of this article is to use quantity to measure institutional investors' preferences.This paper enriches the research on the relationship between cash dividend policy and institutional investor from a new perspective.