A regret-theoretic explanation of corporate dividend policy

Article Abstract:

The study analyses 250 finanical managers of large companies in New York and New England states, US in the context of the Regret Theory. The theory is based on the belief that managers experience regret or pride when they make decisions on risky prospects. Managers' may be hesitant to reduce dividends when needed because they want to avert post-decision regret and experience post-decision pride. The popularity of risky strategy for dividends is derived from a need to feel pride if a likely loss is avoided.

Management, Dividends, Decision theory

---

Convertible debt financing: an empirical analysis

Article Abstract:

The role of convertible debt, the most important hybrid source of finance, in the UK setting was analyzed. The results were able to explain the type of convertible debt issue made, which agreed with Myers' underinvestment hypothesis which links growth opportunities and finance choice. However, the asset substitution rationale failed to justify the actual use of these instruments. Further research should rationalize the continued use of convertible debt.

Capital formation, Hybrid instruments (Finance), Hybrid instruments (Securities)

---

Exchangeable debt calls and security returns

Article Abstract:

A study on exchangeable debt calls and security returns is conducted. Results show that announcements of exchangeable debt calls are not related to an abnormal capital loss for the calling firm shareholders. On the other hand, such announcements are found to result in lower shareholder wealth for target firms. This result may be the result of a lower probability of takeover due to diffusion of ownership concentration of the target firm.

Stock-exchange, Stock exchanges, Options (Finance)

Similar abstracts:

• Abstracts: The impact of recession on the prediction of corporate failure. Predicting Corporate Failure in the UK: A Multidimensional Scaling Approach
• Abstracts: The optimal concentration of creditors. Trends in corporate governance. Equilibrium in a dynamic limit order market
• Abstracts: Revisiting the corroboration effects of earnings and dividend announcements. Should there exist secondary markets for executive stock options?
• Abstracts: Empirical irregularities in the estimation of beta: the impact of alternative estimation assumptions and procedures
• Abstracts: Wall Street: inflation watch. Rate debate hots up. US: nice surprise

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.