MATEC Web Conf.
Volume 184, 2018Annual Session of Scientific Papers IMT ORADEA 2018
|Number of page(s)||4|
|Section||Management and Economics in Engineering|
|Published online||31 July 2018|
The influence of dividend policy on the volatility of shares in the Romanian equity capital market
Technical University of Cluj-Napoca, Faculty of Electrical Engineering, Romania
* Corresponding author: firstname.lastname@example.org
Dividend policy is one of the most debated topics in corporate finance and, at the same time, it represents an important issue from the perspective of both the managers of the firm and the investors. To the best of our knowledge, the literature regarding establishing the relationship between dividend policy and share price volatility of non-financial companies listed on Romanian stock market remains inexistent. This study attempts to identify how the share price volatility of non-financial companies listed on the Bucharest Stock Exchange for a period of sixteen years from 2002 and 2017 is influenced by corporate dividend policy. Results from a cross sectional multiple regression analysis revealed a negative effect of the two components of the dividend policy on the share price volatility. The results support the idea that the lower the dividend yield, the higher the risk to be faced by the shareholder. Growth in assets and share price were negatively related. Positive relationship between firm size and debt ratio to price volatility were identified. However, there was no significant relationship found between earning volatility and price volatility in the Romanian stock market.
© The Authors, published by EDP Sciences, 2018
This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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