Over the past few years, many firms have announced dividends which give conclusive but indirect signal to the investors. The Dividend is declared to show sufficient profitability to finance future expansion in the firms. Dividend declarations have become an important area in financial research considering its strong implications for corporate policy. The article investigates the signalling effect of the dividend announcements and also the significance of cumulative abnormal return of dividend announcements before and after the event day. Further it also tests the evidence of average abnormal return around the announcement date. The analysis uses data of 42 firms in the BSE 500 index, which have announced dividends during the period 2007–2009. An examination of share price behaviour around dividend announcements proves the signalling effect of these announcements. These results strongly support that the share prices drift positively in the case of dividend announcements and the market particularly reacts more favourably to dividend announcements.
The Outbreak of the COVID-19 Pandemic has caused unprecedented risk and uncertainty in the global financial markets. The shattered investor's faith in the Global Financial system has stimulated the need to explore safe haven assets to mitigate risk and safeguard wealth during such turmoil. Therefore, this paper addresses the widely mooted hedge and safe haven property of gold against extreme downturns in the stock market energy sector indices during COVID-19 distress. The sample countries considered comprises of the USA,
The study aims at finding the intraday Lead-Lag relationship between Spot and Futures Market for Energy Sectors Stocks on which Single Stock Futures (SSFs) is available, by applying 1-min Price Returns for the period ranging from April 1, 2017 to March 31, 2019. The study explores pricediscovery between stock futures and their underlying stocks by applying vector error correction model, Hasbrouck (1995) Information Shares, and Common Factor Component Weights of Gonzalo and Granger (1995). The findings indicate that trades in the Futures Market contribute more to Price-Discovery than Spot Market.
Dividend Policy is a crucial decision area in the field of corporate finance and informational efficiency of the market has always been an area of vital interest for financial economists. The literature review documented that in imperfect capital markets with information asymmetries, the dividend announcement affects shareholder wealth. However, very few attempts have been made so far to know dividend behavior of Service sector firms in India. The present study is a little research effort in this direction. This study analyses if the announcements of dividend of stocks listed in Bombay Stock Exchange conveys any information. Fulfilling the study, we calculated the average abnormal return by applying the event study methodology. Daily stock data of 193 firms with market model adjustments on 2436 dividend announcements were used for the period 2000 to 2016 to analyze market efficiency. This study reports stock price reactions of banking, health care, IT and realty sector surrounding 21 days event window of the dividend announcement. The results found mixed results with majority of the firms having presence of informational efficiency in Indian service sector. In Realty sectors stock price reaction to dividend announcement is not statistically significant whereas for other three sectors, Banking, IT and Healthcare, it is significant.
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