Lost in translation: Delayed ex-dividend price adjustments of Hong Kong ADRs

Kadapakkam, Palani Rajan; Meisami, Alex; Shi, Yilun

doi:10.1016/j.jbankfin.2009.09.001

Cited by 8 publications

(18 citation statements)

References 22 publications

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“…By analysing the valuation of Australian ADR dividends using our new approach, using similar controls to Kadapakkam et al. () and using a larger dataset, we find the results of Jun et al. () to be robust.…”

Section: Introductionmentioning

confidence: 59%

“…For ADRs on Hong Kong stocks, an ex‐dividend study by Kadapakkam et al. () finds evidence consistent with the ADR dividend being valued as though it was untaxed, as is the case for dividends on the underlying stocks traded in Hong Kong. For ADRs on Australian stocks an ex‐dividend study by Jun et al.…”

Section: Introductionmentioning

confidence: 93%

“…Kadapakkam et al. () examine ex‐date abnormal returns of ADRs on Hong Kong stocks where dividends and capital gains are tax free.…”

Section: Dividend Value and Equilibrium Pricingmentioning

confidence: 99%

“…Kadapakkam et al. () find the puzzling result that ADR pricing responds to both the ADR ex‐date and the Hong Kong ex‐date for the underlying stock. They find significant abnormal returns of 1.16% (equivalent to an average drop‐off ratio of about 0.3) on the ADR ex‐date.…”

Section: Dividend Value and Equilibrium Pricingmentioning

confidence: 99%

“…However, as discussed in section , Kadapakkam et al. () use a set of control variables and it is an open question whether the results of Jun et al. () are robust to the application of similar controls.…”

Section: Introductionmentioning

confidence: 99%

See 4 more Smart Citations

Taxes, International Clienteles and the Value of ADR Dividends

Jun¹,

Partington

2014

Business Fin & Account

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An alternative approach to valuing dividends is developed and applied to American Depositary Receipts (ADRs) on Australian stocks. The values of ADR dividends are estimated from the period when, due to different ex‐dividend dates, the ADRs and their underlying stocks trade with differential dividend entitlements. Australian ADR dividends are valued at less than their face value and the dividends on the underlying stocks are valued at more than their face value. This suggests that ADR dividends are priced by a clientele of US investors placing little value on the imputation tax credits attached to the dividends and that a clientele of Australian resident investors, who obtain value from imputation tax credits, price the dividends on the underlying stock.

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Section: Introductionmentioning

confidence: 59%

Section: Introductionmentioning

confidence: 93%

“…Kadapakkam et al. () examine ex‐date abnormal returns of ADRs on Hong Kong stocks where dividends and capital gains are tax free.…”

Section: Dividend Value and Equilibrium Pricingmentioning

confidence: 99%

Section: Dividend Value and Equilibrium Pricingmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%