Text
Analisis toward liquidity of stocks treded in the market : a Study on the implementation of reverse stock policy during 2001 - June 2003 by public forms listed in the Jakarta Stock Exchange
One of the famous corporate action that is done by the public firms, is the Reverse Stock Split. One of the reason behind this action, is that the firms believe that this action can improve the stock?s liquidity performance in the market. When the reverse stock policy emerged as the alternative policy to improve the liquidity of stocks traded in the market (in this study the market will be represented by The Jakarta Stock Exchange), then this study is conducted to address the problem of the effect of reverse stock policy toward the liquidity of stocks traded in the market. Did after the reverse stock policy had been implemented, the liquidity of stocks in the market (that had been reverse-split), empirically experienced a significant or meaningful improvement in short term (one quarter of year)? Was reverse stock policy an efficient tool to reach the goal of improving liquidity of stocks traded in the market? Since the reverse stock policy does not cause or bring any economic benefits to the firm, ideally the liquidity will not be affected even in the short term period such as a quarter of year. An ideal liquidity measurement should combine spread, that reflects price concession for immediacy, and depth that reflects the extent of trading. In this study, the measurement of liquidity will be represented by Absolute Covariance (AC) which describes how sensitive the changing in price will affect the changing in trading frequency, vice versa. The stronger the relationship between the two, shows stronger liquidity. The scope of the study, will be focused on the test of the effect after the implementation of reverse stock policy toward the liquidity improvement of stocks traded in the market, as a result of changing in price. The time frame for this study is between year 2001 ? June 2003 and will be divided into four observation periods. The samples are firms that listed their shares on the JSX, and had been implementing reverse stock policy during 2001- June 2003. The secondary data consist of trading frequencies and stock prices, before and after the reverse stock, will be taken only from the regular market of The Jakarta Stock Exchange. The statistical test that will be used in this study is the Wilcoxon Signed-Rank test. Overall, the results on the effect of reverse stock policy toward liquidity of stocks traded in the market is varying. Some firms? stocks experienced improvement in liquidity in the market trading, some experienced no improvement in liquidity, and one of them even experienced a decrease in liquidity. The size of liquidity changes is not affected by reverse stock ratio or market capitalization. Therefore, the reverse stock ratio has nothing to do with the changing in liquidity, but market capitalization does. Derived from the informational factor, it was known that the major stockholders for these firms who become the sample of the study is BPPN (Badan Penyehatan Perbankan Nasional), an organization that functioned to help the government in revitalizing the Banking Sector. Then it is possible that the motivation for doing reverse stock by these firms is also to ?smooth out? the divestation program held by BPPN. Therefore, the reverse stock policy could have been the small part of the grand scenario of divestation. The underline conclusion from this study is that in the short term period, the reverse stock policy is not an efficient tool to reach the goal of improving the liquidity of stocks, because the liquidity is mainly affected by market capitalization. Therefore, in improving the liquidity of stocks traded in the market, it is best for the decision makers in the company to manage the market capitalization first, then do such policy as reverse stock. .Bibliograpy dan tabel
Ketersediaan
| Call Number | Location | Available |
|---|---|---|
| 4984 | PSB lt.2 - Karya Akhir | 1 |
| Penerbit | Depok: Departemen Akuntansi Fakultas Ekonomi Universitas Indonesia 2004 |
|---|---|
| Edisi | - |
| Subjek | Liquidity Stock exchange |
| ISBN/ISSN | - |
| Klasifikasi | - |
| Deskripsi Fisik | xiii, 86 p. ; 30 cm & lamp |
| Info Detail Spesifik | - |
| Other Version/Related | Tidak tersedia versi lain |
| Lampiran Berkas | Tidak Ada Data |