The effect of dividend increases on investor behavior : the dividend clientele hypothesis /
The dividend clientele hypothesis implies that the number of
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| Format: | Thesis Book |
| Language: | English |
| Published: |
[Place of publication not identified] :
[publisher not identified] ;
1997.
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| Subjects: | |
| Online Access: | http://proxy.library.tamu.edu/login?url=http://proquest.umi.com/pqdweb?did=736832781&sid=1&Fmt=2&clientId=2945&RQT=309&VName=PQD |
| Summary: | The dividend clientele hypothesis implies that the number of transactions in the stock of a firm that increased its dividend payment should increase after the dividend increase announcement as the firm's shareholder clientele changes. Ten years of daily transaction data from the New York and American Stock Exchange are used to investigate investor trading behavior following a dividend increase announcement. Unlike price or gross trading volume data, transaction data allows examination of the trading behavior of different investor classes. Evidence of clientele-related trading is provided. The results suggest that the number of transactions increases through the ex-dividend date for both individual and institutional investors after an announcement of a large dividend increase. In contrast to prior research, the amount of abnormal trading through the ex-dividend date is positively correlated with the magnitude of the dividend increase even after controlling for the information content of the announcement. This association between the amount of trading activity and dividend increase magnitude is generally stronger for individual investors than for institutional investors. The analysis is also separately conducted on those trades classified as sells and those as buys. Increased selling (buying) after a dividend increase is generally significant in only those stocks offering a relatively low (high) dividend yield prior to the dividend increase. The rate of abnormal selling and buying after a dividend increase is also positively correlated with the magnitude of the dividend increase. Weak evidence of greater clientele dividend reactions pre-Tax Reform Act of 1986 is provided. |
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| Item Description: | Vita. "Major Subject: Accounting". |
| Physical Description: | ix, 97 leaves ; 28 cm. Issued also on microfiche from University Microfilms Inc. |
| Bibliography: | Includes bibliographical references: pages 90-93. |