| As a innovative financial tool in the Chinese Security market,convertible bonds can be a good alternative to placements and private placements to help listed companies realize equity financing.Convertible bond market developed rapidly since the introduction of the new refinancing rules in 2017.It is still less than 30 years since the first convertible bond issued.Gradual improvement of regulations and supervision has formed a complete issuance and trading system.At the same time,investor have increasingly paid attention to the investment in convertible bonds.However,the research on the announcement effect of convertible bonds is still insufficient,and the consideration of regulatory differences is still lacking.Based on the domestic and foreign studies,this article summaries the influencing factors including company,issued and market factors,and studies the announcement effects of China's convertible bond issuance from 2010 to 2019,focused on the differences with financial and non-financial companies,China Growth Enterprise Market(GEM)and Main Board Companies.The study found that financial companies have cumulative abnormal return(CAR)that were not significantly positive during the announcement period,while the non-financial board companies' CAR are basically zero,but they have significant negative excess returns after the announcement date.GEM companies are different,they have a significantly positive CAR relative to themain board company during [-10,+10] period.This result supports the hypothesis of this article.Although financial institutions are subject to more regulatory constraints and can suppress the asymmetry of internal and external information,but the initial conversion price is limited and higher than that of non-financial companies.On the other hand,GEM companies are generally small and medium-sized high-tech companies,with higher financing needs and a stronger willingness to convert stocks.The issue of convertible debt financing has been more recognized by investors. |
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