Research On The Impact Of Net Stock Issuance On Stock Price Crash Risk

In recent years,the phenomenon of "thousands of stocks making a sudden stop" has occurred frequently at home and abroad.The stock price crash will not only seriously hit the confidence of investors,but also hinder the healthy development of the capital market and even endanger the smooth operation of the real economy.Since the19 th National Congress of the Communist Party of China,the prevention and control of financial risks has become the inevitable battle of building a well-off society in an all-round way,and its importance has become increasingly prominent.In this context,accurately identifying the factors causing the accumulation of stock price crash risk and effectively preventing and controlling stock price crash have become the common focus.Net stock issuance refers to the actual annual number of shares issued by a listed company.The behaviors that cause the change of net stock issuance include private placement,public placement,allotment and stock repurchase.These four behaviors that will affect the expected cash flow of listed companies are important means for the company to carry out market value management,and may also become a tool for management information manipulation,resulting in the potential risk of stock price crash.From a comprehensive cash flow perspective,this paper examines the impact of net stock issuance on the risk of stock price crash and its conduction mechanism,so as to provide new ideas for alleviating the risk of stock price crash.This paper selects the annual data of Listed Companies in China’s A-share market from 2013 to 2020,with the help of the mixed regression model and intermediary effect model of fixed years and industries,discusses the impact of net stock issuance on the risk of stock price crash,and empirically evaluates the intermediary effect of investor sentiment between the two.After changing the measurement method of the explained variables and considering the influence of the selection of sample period,the empirical results of this paper are still robust.The research of this paper shows that:(1)net stock issuance will accelerate the risk of stock price crash.(2)Investor sentiment plays a partial mediating role in the impact of net stock issuance on the risk of stock price crash.According to the above research conclusions,this paper gives corresponding suggestions from the perspectives of investors,management of listed companies,financial institutions and regulatory authorities:(1)investors should cultivate the concept of "prudent investment" and avoid blindly following the trend.(2)Before issuing or repurchasing shares,the management of a listed company should stabilize market sentiment with effective communication and reduce agency costs with reasonable incentives afterwards.(3)Financial institutions should cultivate the professional quality of employees and improve their professional ethics.(4)Regulators should guide market sentiment with their prestige and regulate the behavior of listed companies and financial institutions by law.