Financial Management articles from December 2008

Financial Management archives from December 2008

Managerial response to the May 2003 dividend tax cut.(Survey)
December 22, 2008... We survey 328 financial executives to determine the effects of the May 2003 dividend tax cut. We find that the tax cut led to initiations and dividend increases at some firms. However, executives say that among the factors that affect dividend...

How did the 2003 dividend tax cut affect stock prices?(Report)
December 22, 2008... We test the hypothesis that the 2003 dividend tax cut boosted US stock prices and thereby lowered the cost of equity capital. Using an event-study methodology, we attempt to identify an aggregate stock market effect by comparing the behavior of...

The effect of fiduciary standards on institutions' preference for dividend-paying stocks.
December 22, 2008... Many researchers apparently believe that some institutional investors prefer dividend-paying stocks because they are subject to the "prudent man" (PM) standard of fiduciary responsibility, under which dividend payments provide prima facie...

Asymmetric information and dividend policy.(Report)
December 22, 2008... We examine how informational asymmetries affect firms' dividend policies. We find that firms that are more subject to information asymmetry are less likely to pay, initiate, or increase dividends, and disburse smaller amounts. We show that our...

Stock splits as a manipulation tool: evidence from mergers and acquisitions.(Report)
December 22, 2008... We document that acquiring firms are more likely than nonacquiring firms to split their stocks before making acquisition announcements, especially when acquisitions are financed by stock and when the deals are large. Our findings support the...

Do voting rights affect institutional investment decisions? Evidence from dual-class firms.(Report)
December 22, 2008... We examine whether, and to what extent, shareholder voting rights affect institutional investment decisions. We find that institutional ownership in dual-class firms is significantly lower than it is in single-class firms after controlling for...

Does voluntary disclosure improve stock price informativeness?(Report)
December 22, 2008... According to theory, comovement in stock prices reflects comovement in the fundamental factors underlying the values of stocks. Recent theory contends that stock price comovement can be driven by information markets or the informational opacity...

Foreign exchange volatility is priced in equities.(Report)
December 22, 2008... This paper finds that standard asset pricing models fail to explain the significantly negative delta hedging errors that occur as a result of the purchase of options on foreign exchange futures. Foreign exchange volatility does influence stock...