Research On The Effect Of Cash Dividend On Stock Price Fluctuation

Since Lintner proposed the relationship between cash dividends and stock prices in 1956,As one of the three major financial policies of listed companies,cash dividend policy has attracted the attention of domestic and foreign scholars.With the continuous development of the capital market,research on the impact of cash dividend policies on stock prices has been abundant.A reasonable cash dividend policy is an important signal to reflect the business situation of the enterprise,the most direct way to return the investor to the enterprise,the foundation of the enterprise's own future fund-raising activities and the effective measures to stabilize the stock price.On the one hand,as the development of China's securities market is not mature enough,on the one hand,the cash dividend policy of listed companies shows obvious randomness.The phenomenon of low cash dividend and cash dividend is very common,and the policy of cash dividend is not stable and persistent.The cash dividend policy is not stable and continuous.On the other hand,Chinese investors are mainly retail investors,and speculative activities are rampant.They are excessively pursuing gains from the rise in stock prices rather than attach importance to cash dividends,which leads to the frequent fluctuation of the stock.In order to standardize the formulation of cash dividend policy for listed companies,the China Securities Regulatory Commission promulgated the "Decision on Modifying Several Provisions of Cash Dividends for Listed Companies" in October 2008.It is required that the listed companies have to disclose the cash dividend policy in the annual report,and stipulate that the level of cash dividends of listed companies is not less than thirty of the average distribution profit in the last three years.However,the impact of this semi mandatory dividend policy on Listed Companies in different lifecycle is very different.For example,companies in the growth period usually have large demand for funds,and high cash dividends may not be conducive to the development of the company.In fact,the formulation of cash policies for listed companies in China is non-normative.Many listed companies obviously distribute cash dividends in accordance with the minimum standards stipulated by the China Securities Regulatory Commission.Due to the investors have to pay a certain percentage of bonus tax after receiving dividends,the cash dividend is very limited,and even pay additional taxes.Therefore,only the listed companies are required to implement the semi-mandatory dividend policy and cannot achieve the purpose of regulating the listed company's formulation of the dividend policy and maintaining the stable development of the capital market.Therefore,if the listed company tries to stabilize the stock price through cash dividends,it is necessary to study the specific relationship between cash dividends and stock prices.At present,there are two major characteristics in the study of the relationship between cash dividend and stock price fluctuation in China: First,it takes the listed companies of the whole A stock or the gem as a sample to carry out an empirical analysis;secondly,most of the researchers use cash dividend per share as the standard to measure the cash dividend policy.Evaluate the criteria for cash dividend policy.There are obvious advantages and disadvantages of the two features: the former has a large sample size,and the empirical results are certainly more persuasive.However,the research results can only provide reference for the listed companies or investors in the whole A stock market or the GEM market,but can not provide suggestions for the stock or fund investors of a specific plate or industry;the latter Selecting cash dividend per share as an explanatory variable,it can directly reflect the strength of the dividend per share of the listed companies,but conceals the important premise that the stock price of the listed companies is uneven.Therefore,the purpose of this paper is to select the listed companies of a single industry as a sample,and to increase the rate of payment as an explanatory variable and the ratio of cash dividends per share,so as to enrich the relationship between cash dividends and stock volatility.The household appliances industry of China has maintained a sustained and stable development,and the scale of production is the highest in the world.For the consumer groups around the world,the products of the household appliances industry are necessities,and the annual operating income is more stable than the other industries,and it is not easily affected by the macroeconomic policies of the country.At present,there are few studies on the dividend policy in the home appliance industry.Most of them are limited to the research on the development status of the industry or the factors affecting the dividend policy.This paper is based on the difference between the profitability,financial leverage and ownership concentration of different listed companies,to the cash dividend and the stock price.The empirical study of the relation of grid is expected to provide some reference for the listed companies in the home appliance industry to formulate the dividend policy and the investors to select the stock.In this paper,the data of 2012-2016 years' Listed Companies in the household electrical appliance industry are selected as the research samples,and the regression analysis method of panel data is used to make an empirical study on the relationship between the cash dividend policy and the stock price fluctuation.The results show that the cash dividend per share is represented by the cash dividend policy,and the listed companies pay cash dividends to promote the volatility of the stock price;and the dividend payment rate represents the cash dividend policy,and the listed companies pay cash dividends to promote the stock price stability.The difference between the two shows the characteristics of the cash dividend policy of the listed companies in the household electrical appliance industry: the dividend level of the listed companies with high stock prices is relatively low.The dividend payout ratio can be used to measure the cash dividends,which can better reflect the sincerity of the listed company in distributing the net profit to shareholders.The results show that the higher the rate of dividend payment,the more the investor's confidence can be strengthened,the investor should pay attention to the value investment choice to hold the stock for a long time,and then restrain the speculation and maintain the stability of the stock price.Finally,according to the conclusion of empirical analysis,we provide suggestions for investors,listed companies and regulators.