scholarly journals The impact of successor characteristic on stock returns

2011 ◽  
Vol 8 (2-5) ◽  
pp. 516-524
Author(s):  
Wei-Chuan Wang ◽  
Yi-Min Yu ◽  
Shi-jie Jiang
Keyword(s):  
Stock Returns ◽  
Common Sense ◽  
Market Model ◽  
Wealth Effects ◽  
Executive Turnover ◽  
Vicious Cycle ◽  
Top Executives ◽  
Top Managers ◽  
The Common ◽  
The Impact

To find out effects of top managers’ turnover on stock returns, this study utilizes the market model to analyze the wealth effects of top executive turnover in Taiwanese listed electronic companies. Results in this study show that in the case of insider successor condition, it supports the ritual scapegoating theory for top executives (R&D Managers and CEOs). The results of chairmans are more consistent with vicious cycle hypothesis. On the other hand, the case of outsider successor condition shows that the ritual scapegoating theory is more suitable for CEOs and chairmans. The common sense theory is more valid when the new outsider successors are R&D Managers. The results of this study show that selecting the chairman of board is a critical decision when new successors of chairman of board are insider. The results also show the turnovers of R&D managers have positive stock reactions when new successors are outsiders

Alcohol Problem Prevention: A “Common Sense” Approach

1987 ◽  
Vol 17 (4) ◽  
pp. 369-393
Author(s):  
Selden D. Bacon
Keyword(s):  
Common Sense ◽  
Direct Methods ◽  
The United States ◽  
Alcohol Problems ◽  
The Social ◽  
The Common ◽  
Definition Of ◽  
The Impact ◽  
Alcohol Related Problems ◽  
Social Science Approach

In view of the low likelihood of the acceptance of the social science approach to alcohol problems proposed several years ago, a “common sense” approach is suggested as an alternative. Several assumptions guide this proposal, the principal one being the absence of any significant progress in the reduction of alcohol problems in the United States over the past 200 years. By the development of a common vocabulary and direct methods of observation and data collection, the “common sense” approach would provide for identifying the strengths of the multitude of past and current efforts in dealing with alcohol problems in terms of both intervention and prevention. The guiding criterion in such an approach would be the impact on alcoholism and alcohol-related problems, the definition of which would be a major task of the research.

The impact of qualified audit opinion on stock returns: an empirical study at Amman stock exchange

2022 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Rana Bayo Flees ◽  
Sulaiman Mouselli
Keyword(s):  
Stock Returns ◽  
Stock Exchange ◽  
Abnormal Returns ◽  
Market Model ◽  
Content Type ◽  
Going Concern ◽  
Study Approach ◽  
Audit Opinions ◽  
The Impact ◽  
First Time

Purpose This paper aims to investigate the impact of qualified audit opinions on the returns of stocks listed at Amman Stock Exchange (ASE) after the introduction of the recent amendments by the International Auditing and Assurance Standard Board (IAASB) on audits reporting and conclusions. It further investigates if results differ between first time qualified and sequenced qualifications, and between plain qualified opinion and qualifications with going concern. Design/methodology/approach Audit opinions’ announcements and stock returns data are collected from companies’ annual reports for the fiscal years 2016 to 2019 while stock returns are computed from stock closing prices published at ASE website. The authors apply the event study approach and use the market model to calculate normal returns. Cumulative abnormal returns (CARs) and average abnormal returns (AARs) are computed for all qualified audit opinions’ announcements. Findings The empirical evidence suggests that investors at ASE do not react to qualified audit opinions announcements. That is, the authors find an insignificant impact of qualified audit opinion announcements on stock returns using both CAR and AAR estimates. The results are robust to first time and sequenced qualifications, and for qualifications with going concern. Results are also robust to the use of risk adjusted market model. Research limitations/implications The insignificant impact of qualified audit opinions on stock returns have two potential conflicting research implications. First, the new amendments introduced to auditors’ report made them more informative and reduce the negative signals contained in the qualified opinions. That is, investors are now aware of the real causes of qualifications and not overreacting to the qualified opinion. Second, the documented insignificant impact confirms that ASE is not a semi-strong form efficient. Practical implications The apparent excessive use of qualifications should ring the bell on whether auditors misuse their power or companies are really in trouble. Hence, the Jordanian regulatory bodies need to warn auditors against the excessive use of qualifications on the one hand, and to raise the awareness of investors on the implications of auditors’ opinions on the other hand. Originality/value This study is innovative in twofold. First, it explores the impact of qualified audit opinions on stock returns after the introduction of new amendments by IAASB at ASE. In addition, it uses event study approach and distinguishes between first time qualified and sequenced qualifications, and between plain qualified opinion and qualifications with going concern. The results are consistent with efficient market theory and behavioral finance explanations.

Do firms harvest from political connections during general elections? Case of Pakistan

2020 ◽  
Vol 27 (1) ◽  
pp. 258-273
Author(s):  
Ayesha Ashraf ◽  
M. Kabir Hassan ◽  
Khurram Abbas ◽  
Qamar Uz Zaman
Keyword(s):  
Stock Returns ◽  
Abnormal Returns ◽  
Share Price ◽  
Market Model ◽  
Political Connections ◽  
Content Type ◽  
Connected Group ◽  
Playing Field ◽  
General Elections ◽  
The Impact

Purpose This paper aims to examine the impact of general elections on the stock returns of the politically connected group affiliated firms of Pakistan. Design/methodology/approach This study uses the market model to assess the impact of political connections (PCs) on abnormal stock returns, before and after election events. We have used share price data of non-financial firms of Pakistan for the years 2008-2013. Findings It has been found that behavior of cumulative average abnormal returns (CAAR) is significantly different for standalone and politically connected group affiliated firms. The results reveal that CAARs of politically connected group affiliated firms have experienced less deviation as compared to stand alone firms. Therefore, it is argued that politically connected group firms may reduce the impact of political uncertainty on stock returns in comparison to stand alone firms. Practical implications This study is helpful for policy regulators of Pakistan to devise appropriate policies to maintain a level playing field for politically connected and standalone firms. Originality/value This study provides a new dimension to understand the role and association of PCs and general elections with stock markets returns.

Impact of Share Splits on Stock Returns: Evidences from India

2019 ◽  
Vol 23 (4) ◽  
pp. 432-441
Author(s):  
Bilal Ahmad Pandow ◽  
Khurshid Ahmad Butt
Keyword(s):  
Stock Returns ◽  
Impact Analysis ◽  
Positive Influence ◽  
Market Model ◽  
Sign Test ◽  
Rank Test ◽  
Long Run ◽  
Short Run ◽  
Study Methodology ◽  
The Impact

This article empirically examines the impact of stock splits on the price movements and returns of the scrips listed on the stock market in India. The study makes use of the standard event study methodology to measure the significance of unusual yield associated with the event. To calculate the returns, the study employs market model. Also, it uses parametric tests, such as t-statistic, and non-parametric test, such as Corrado Rank Test, Generalized Rank Test and Sign Test, to check the significance and robustness of abnormal return (AR), average AR, and cumulative average AR. Indisputably, the results are somewhat different from the evidences found in developed markets. Mostly in these countries, the event witnesses unusual optimistic yields. The results suggest that there is a positive AR adjacent to the effective day (ED) of the event in the short run. However, in the long run, negative ARs in the post-effective to ED+90 days window is witnessed. Further, the analysis also suggests that share splits do not have a positive influence on the share capital of the investors. The results are based on the 10-days event and 90-days estimation window and are the main limitation of the study. Hence, the windows can be both expanded and reduced to have a better holistic impact analysis of the share splits and stock returns of the selected firms.

The impact of state development institutionson the innovative behavior of firms: qualitative effects

2017 ◽  
pp. 109-135 ◽  
Author(s):  
Y. Simachev ◽  
M. Kuzyk
Keyword(s):  
Public Support ◽  
State Intervention ◽  
State Development ◽  
Top Executives ◽  
Top Managers ◽  
Development Institutions ◽  
Financial Impacts ◽  
The Impact ◽  
Depth Interviews ◽  
Innovation Behavior

Basing on a series of in-depth interviews with top executives of Russian innovation companies, the paper analyzes qualitative effects generated by the support from the state development institutions. Non-financial impacts, in particular, changes in firms’ innovation behavior, turned out to be quite significant. At the same time, tightening of formal control of the development institutions increases the risks and costs faced by the supported companies. We have identified two models of firms’ innovation behavior associated with different demand for public support instruments. These models are conditioned not so much to firms’ characteristics, but rather by the values of top managers and their views on appropriate forms of state intervention in innovation processes.

A Study of Wealth Effects of Takeover Announcements in India on Target Company Shareholders

2013 ◽  
Vol 38 (3) ◽  
pp. 23-50 ◽  
Author(s):  
T Mallikarjunappa ◽  
Panduranga Nayak
Keyword(s):  
Strategic Alliances ◽  
Stock Price ◽  
Statistical Significance ◽  
Abnormal Returns ◽  
Wealth Effect ◽  
Market Model ◽  
Wealth Effects ◽  
Event Window ◽  
Target Company ◽  
The Impact

The business strategy of inorganic growth is carried out by companies by resorting to actions which prominently include mergers, takeovers, and strategic alliances. There is a rapid growth of both mergers and takeovers in India subsequent to the economic liberalization. The companies consider takeover activity as the quickest means of corporate growth to enhance their size and face the domestic and global competition. In spite of several decades of vast research, researchers have not come to the final conclusion on the wealth effect of announcements of takeovers on the shareholders of participating companies. While some studies justify takeover as a socially productive activity which creates value for the shareholders, others provide contrary evidences to show that they destroy value for the shareholders. In India, only some studies have analysed the impact of M&A announcements on the stock return performance of companies involved and there is lack of evidences on wealth effects on shareholders. Therefore, this paper assesses the impact of takeover announcement on the stock price performance of target companies by taking a sample of 227 companies which received takeover bids during 1998–2007. The stock price reaction is examined for a period of 61 days surrounding the bid announcement day employing standard market model. BSE- 200 index is used as a proxy for the market. The regression co-efficient and the constant terms are estimated over a period of 250 days (-280 to -31) and the statistical significance of the results of the study is determined by non-standardized and standardized abnormal return methods. Both raw returns and log returns are examined. Results of the study show that target company shareholders experience substantial and statistically significant cumulative average abnormal returns (CAARs) of 27-37 percent — 37 percent when raw returns are employed and 27 percent when log returns are employed. The conclusions remain unchanged irrespective of the testing procedure used (i.e., non-standardized or standardized abnormal returns method) and even for several shorter event window periods within a broader event window of 61 days. The results for target companies are consistent with the evidence of extant research that major benefits from M&As accrue to target company shareholders. The practical implication of the study is that there is a large and significantly positive wealth effect on the target company shareholders in response to the announcement of takeovers. Takeovers offer an opportunity to shareholders of target companies and general investors to make profits both in the period before and after the announcement of the takeover bid.

The announcement and implementation reaction to China's margin trading and short selling pilot programme

2014 ◽  
Vol 10 (3) ◽  
pp. 368-384 ◽  
Author(s):  
Saqib Sharif ◽  
Hamish D. Anderson ◽  
Ben R. Marshall
Keyword(s):  
Stock Returns ◽  
Event Study ◽  
Stock Exchange ◽  
Abnormal Returns ◽  
Short Selling ◽  
Market Model ◽  
Short Sales ◽  
Content Type ◽  
Pilot Programme ◽  
The Impact

Purpose – The purpose of this paper is to investigate how the announcement and implementation of short sales and margin trading regulation affects Chinese stock returns and trading volume. On 31 March 2010, the Chinese regulators launched a pilot programme, allowing short sales and margin trading for 50 Shanghai Stock Exchange and 40 Shenzhen Stock Exchange stocks. Design/methodology/approach – This paper uses an event study approach to compare market model abnormal returns (ARs) of the pilot firms with two distinct matched firm samples. A volume event study is also conducted to examine abnormal trading activity surrounding the key events in the pilot stocks. Findings – Negative ARs follow both the announcement and implementation of short selling and margin trading. This suggests the negative impact of short sales dominates the positive impact of margin trading on an average. Volume also declines, which is consistent with uninformed investors’ seeking to avoid trading against informed traders. Originality/value – The paper appears to be the first to address the impact of both the announcement and implementation of short selling and margin trading rule changes on returns and liquidity using individual stock data.

scholarly journals Mosquito-Borne Diseases: Social Representations of a University Community in Endemic Outbreaks

2021 ◽  
Vol 13 (2) ◽  
pp. 486-493
Author(s):  
Sylvain Delouvée ◽  
Gail Moloney ◽  
Kathleen McColl ◽  
Grégory Lo Monaco
Keyword(s):  
Common Sense ◽  
Social Representations ◽  
Academic Community ◽  
Lay Theories ◽  
Social Actors ◽  
Attitudes And Behaviors ◽  
Correspondence Factor Analysis ◽  
The Common ◽  
Access Information ◽  
The Impact

(1) Background: Studying social representations as lay theories allows for a better understanding of the common sense knowledge constructed around mosquito-borne diseases and the impact this may have on attitudes and behaviors. (2) Methods: A hierarchical evocation questionnaire was circulated through an Australian academic community and analyzed by prototypical analysis and correspondence factor analysis. (3) Results: Representational areas are regulated by participant age and whether or not they had contracted a mosquito-borne disease. (4) Conclusions: Collecting and understanding social representations has the potential to help social actors implement strategies that encourage people to access information and adopt behaviors in line with the scientific reality of the phenomenon, rather than limiting lay theories.

scholarly journals Influence of Board Reformation on the Stock Returns: an Event Study

2018 ◽  
Vol 7 (3.16) ◽  
pp. 71
Author(s):  
Bindya Kohli ◽  
Deepa Pillai
Keyword(s):  
Organizational Performance ◽  
Stock Returns ◽  
Event Study ◽  
Stock Prices ◽  
Stock Price ◽  
Negative Impact ◽  
Market Model ◽  
Age Related ◽  
The Board Of Directors ◽  
The Impact

Investor sentiments pertaining to stocks are propelled by the contentions of financial sector reforms, fiscal policy and management change. Any uncertainty has a significant impact on the stock prices and returns accruing to the company. The paper examines the effect of change in management on the stock returns of a corporate entity. Organizational performance is dependent on the realization of the numerous roles the board of directors are entrusted with. Any change in the composition of the board through the resignation, retirement or ouster can thus have a significant impact on the stock prices and returns accruing to the company. It is anticipated that voluntary resignations, age related turnovers have small or negative impact on the stock price reactions. The paper investigates the impact of the ouster of the Chairman of the Tata group on the volatility of the daily prices and returns of four companies under the Tata umbrella. Event study methodology has been adopted following the market model of return generating process. Investors react to the market information thereby affecting the security prices positively or negatively during the event window. The findings disclose market sentiments are affected on the occurrence of the event though the acceptance of the event may be unforeseen. 

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