Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies

Zhang Benzhao; Xie Xuan

doi:doi:10.11648/j.ajomis.20180304.11

| Peer-Reviewed

Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies

Zhang Benzhao, Xie Xuan

Published in American Journal of Operations Management and Information Systems (Volume 3, Issue 4)

Received: 1 November 2018 Accepted: 27 November 2018 Published: 2 January 2019

Views: Downloads:

Download PDF

Share This Article

Twitter
Linked In
Facebook

Abstract

The purpose of this paper is to explore how a company’s voluntary information disclosure influences its stock price synchronicity and how the company’s financial status influences the relationship between voluntary information disclosure and stock price synchronicity. This study utilizes the panel regression model with the data of Shanghai and Shenzhen 300 Index constituent stocks from 2010 to 2017 in Chinese stock market to analyze the relationship between voluntary information disclosure and stock price synchronicity and how financial status influences the relationship. The results show that voluntary information disclosure is negatively related to stock price synchronicity. The financial status in general is likely to decrease stock price synchronicity. However the three different indictors, profitability, solvency and development ability, of financial status have different impacts on the relationship between voluntary information disclosure and stock price synchronicity. The company’s profitability strengthens the relationship of voluntary information disclosure and stock price synchronicity. While the solvency and the development ability have little impact on the relationship. It can be seen that investors are paying more attention to the intrinsic value of the companies and the quality of the Chinese stock market is obviously improving. Based on the results the paper proposes some useful suggestion in the end.

Published in	American Journal of Operations Management and Information Systems (Volume 3, Issue 4)
DOI	10.11648/j.ajomis.20180304.11
Page(s)	74-80
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2019. Published by Science Publishing Group

Keywords

Voluntary Information Disclosure, Stock Price Synchronicity, Financial Status

References

[1]	Roll, R. (1988). R². Journal of Finance, 43, 541-566.
[2]	Jin, L., Myers, S. C. (2006). R² Around the World: New Theory and New Tests. Journal of Financial Economics, 79, 257-292.
[3]	Morck, R., Yeung, B. and Yu, W. (2000). The Information Content of Stock Markets: Why Do Emerging Markets Have Synchronous Stock Price Movements. Journal of Financial Economics, 58, 215-260.
[4]	Chen G. (2018). Information Asymmetry, Institutional Investors and Stock Price Synchronicity. Journal of the Postgraduate of Zhongnan University of Economics and Law, 3, 73-79.
[5]	Hong Y., Li T. T. and Yao K. H. (2018). Margin Financing, Characteristic Information Disclosure and Stock Price Synchronization. Finance and Accounting Monthly, 4, 153-161.
[6]	Dai Y. H. et al. (2012). Stock Price Synchronicity and Information Efficiency. Chinese Review of Financial Studies, 1, 82-92.
[7]	Shi Y. (2013). The Quality of Information Disclosure, Auditor Selection and Stock Price Synchronicity. Journal of Zhongnan University of Economics and Law, 5, 118-123
[8]	Jin Z. (2010). New Accounting Standard, Accounting Information Quality and Stock Price Synchronicity. Accounting Research, 7, 19-26.
[9]	Zhang B. Z., Niu J. J. and Wang H. T. (2016). Voluntary Information Disclosure, Accounting Standards Change and Stock Price Synchronicity. Communication of Finance and Accounting, 7, 3-7.
[10]	Wang Y. P., Liu H. L. and Wu L. S. (2009). Information Transparency, Institutional Investor and Stock Price Comovement. Journal of Financial research, 12, 162-174.
[11]	Fama, Eugene F. (1965). The Behavior of Stock Market Price. Journal of Business, 38 (1), 34-105.
[12]	Li Z., Xu N. (2015). Analysis of Influencing Factors of Investors’ Decision-making Based on Analytic Hierarchy Process. Friends of Accounting, 2, 88-92.
[13]	Grossman, S. J., Hart, O. (1980). Disclosure Laws and Takeover Bids. Journal of Finance, 35 (2), 323-327.
[14]	Spence, M. (1973). Job Market Signaling. The Quarterly Journal of Economics, 87 (3), 355-374.
[15]	Li H. Y., Lv W. H. (2012), Study on the Status and Supervision of Chinese Listed Companies Voluntary Disclosure. Statistical Research, 4, 86-91.
[16]	Beyer, A. et al. (2010). The Financial Reporting Environment: Review of the Recent Literature. Journal of Accounting and Economics, 50, 296–343.
[17]	Durnev, A. et al. (2003). Does Greater Firm-specific Return Variation Mean More or Less Informed Stock Pricing? Journal of Accounting Research, 41 (5), 797-836.
[18]	Bhattaeharya, U., Daouka, H. and Welker, M. (2003). The World Price of Earning of Opacity. The Accounting Review, 78, 641-678.
[19]	Hutton, A. P., Marcus, A. J. and Tehranian, H. (2009).Opaque Financial Report, R², and Crash Risk. Journal of Financial Economic, 94 (1), 67-86.
[20]	Luo J. H., Li X. and Lin Z. R. (2018). The Influence of Auditors’ Geographic Distance on Client Companies’ Stock Price Informativeness. Journal of Audit & Economics, 4, 34-45.
[21]	Chen G., Zhang J. Y. (2018). An Empirical Study on the Correlation between Accounting Information and Stock Price of small and Medium-sized Listed Companies. Modern Business Trade Industry, 23, 117-118.

Cite This Article

Plain Text BibTeX RIS

APA Style

Zhang Benzhao, Xie Xuan. (2019). Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies. American Journal of Operations Management and Information Systems, 3(4), 74-80. https://doi.org/10.11648/j.ajomis.20180304.11

Copy | Download

ACS Style

Zhang Benzhao; Xie Xuan. Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies. Am. J. Oper. Manag. Inf. Syst. 2019, 3(4), 74-80. doi: 10.11648/j.ajomis.20180304.11

Copy | Download

AMA Style

Zhang Benzhao, Xie Xuan. Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies. Am J Oper Manag Inf Syst. 2019;3(4):74-80. doi: 10.11648/j.ajomis.20180304.11

Copy | Download

@article{10.11648/j.ajomis.20180304.11,
  author = {Zhang Benzhao and Xie Xuan},
  title = {Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies},
  journal = {American Journal of Operations Management and Information Systems},
  volume = {3},
  number = {4},
  pages = {74-80},
  doi = {10.11648/j.ajomis.20180304.11},
  url = {https://doi.org/10.11648/j.ajomis.20180304.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajomis.20180304.11},
  abstract = {The purpose of this paper is to explore how a company’s voluntary information disclosure influences its stock price synchronicity and how the company’s financial status influences the relationship between voluntary information disclosure and stock price synchronicity. This study utilizes the panel regression model with the data of Shanghai and Shenzhen 300 Index constituent stocks from 2010 to 2017 in Chinese stock market to analyze the relationship between voluntary information disclosure and stock price synchronicity and how financial status influences the relationship. The results show that voluntary information disclosure is negatively related to stock price synchronicity. The financial status in general is likely to decrease stock price synchronicity. However the three different indictors, profitability, solvency and development ability, of financial status have different impacts on the relationship between voluntary information disclosure and stock price synchronicity. The company’s profitability strengthens the relationship of voluntary information disclosure and stock price synchronicity. While the solvency and the development ability have little impact on the relationship. It can be seen that investors are paying more attention to the intrinsic value of the companies and the quality of the Chinese stock market is obviously improving. Based on the results the paper proposes some useful suggestion in the end.},
 year = {2019}
}

Copy | Download

TY  - JOUR
T1  - Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies
AU  - Zhang Benzhao
AU  - Xie Xuan
Y1  - 2019/01/02
PY  - 2019
N1  - https://doi.org/10.11648/j.ajomis.20180304.11
DO  - 10.11648/j.ajomis.20180304.11
T2  - American Journal of Operations Management and Information Systems
JF  - American Journal of Operations Management and Information Systems
JO  - American Journal of Operations Management and Information Systems
SP  - 74
EP  - 80
PB  - Science Publishing Group
SN  - 2578-8310
UR  - https://doi.org/10.11648/j.ajomis.20180304.11
AB  - The purpose of this paper is to explore how a company’s voluntary information disclosure influences its stock price synchronicity and how the company’s financial status influences the relationship between voluntary information disclosure and stock price synchronicity. This study utilizes the panel regression model with the data of Shanghai and Shenzhen 300 Index constituent stocks from 2010 to 2017 in Chinese stock market to analyze the relationship between voluntary information disclosure and stock price synchronicity and how financial status influences the relationship. The results show that voluntary information disclosure is negatively related to stock price synchronicity. The financial status in general is likely to decrease stock price synchronicity. However the three different indictors, profitability, solvency and development ability, of financial status have different impacts on the relationship between voluntary information disclosure and stock price synchronicity. The company’s profitability strengthens the relationship of voluntary information disclosure and stock price synchronicity. While the solvency and the development ability have little impact on the relationship. It can be seen that investors are paying more attention to the intrinsic value of the companies and the quality of the Chinese stock market is obviously improving. Based on the results the paper proposes some useful suggestion in the end.
VL  - 3
IS  - 4
ER  -

Copy | Download

Author Information

Zhang Benzhao

Industrial Information and Center for Economic Research, Hefei University of Technology, Hefei, China
Xie Xuan

School of Economics, Hefei University of Technology, Hefei, China

Download PDF

Sections

Plain Text BibTeX RIS

APA Style

Zhang Benzhao, Xie Xuan. (2019). Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies. American Journal of Operations Management and Information Systems, 3(4), 74-80. https://doi.org/10.11648/j.ajomis.20180304.11

Copy | Download

ACS Style

Zhang Benzhao; Xie Xuan. Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies. Am. J. Oper. Manag. Inf. Syst. 2019, 3(4), 74-80. doi: 10.11648/j.ajomis.20180304.11

Copy | Download

AMA Style

Zhang Benzhao, Xie Xuan. Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies. Am J Oper Manag Inf Syst. 2019;3(4):74-80. doi: 10.11648/j.ajomis.20180304.11

Copy | Download

@article{10.11648/j.ajomis.20180304.11,
  author = {Zhang Benzhao and Xie Xuan},
  title = {Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies},
  journal = {American Journal of Operations Management and Information Systems},
  volume = {3},
  number = {4},
  pages = {74-80},
  doi = {10.11648/j.ajomis.20180304.11},
  url = {https://doi.org/10.11648/j.ajomis.20180304.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajomis.20180304.11},
  abstract = {The purpose of this paper is to explore how a company’s voluntary information disclosure influences its stock price synchronicity and how the company’s financial status influences the relationship between voluntary information disclosure and stock price synchronicity. This study utilizes the panel regression model with the data of Shanghai and Shenzhen 300 Index constituent stocks from 2010 to 2017 in Chinese stock market to analyze the relationship between voluntary information disclosure and stock price synchronicity and how financial status influences the relationship. The results show that voluntary information disclosure is negatively related to stock price synchronicity. The financial status in general is likely to decrease stock price synchronicity. However the three different indictors, profitability, solvency and development ability, of financial status have different impacts on the relationship between voluntary information disclosure and stock price synchronicity. The company’s profitability strengthens the relationship of voluntary information disclosure and stock price synchronicity. While the solvency and the development ability have little impact on the relationship. It can be seen that investors are paying more attention to the intrinsic value of the companies and the quality of the Chinese stock market is obviously improving. Based on the results the paper proposes some useful suggestion in the end.},
 year = {2019}
}

Copy | Download

TY  - JOUR
T1  - Relationship Between Voluntary Disclosure, Stock Price Synchronicity and Financial Status: Evidence from Chinese Listed Companies
AU  - Zhang Benzhao
AU  - Xie Xuan
Y1  - 2019/01/02
PY  - 2019
N1  - https://doi.org/10.11648/j.ajomis.20180304.11
DO  - 10.11648/j.ajomis.20180304.11
T2  - American Journal of Operations Management and Information Systems
JF  - American Journal of Operations Management and Information Systems
JO  - American Journal of Operations Management and Information Systems
SP  - 74
EP  - 80
PB  - Science Publishing Group
SN  - 2578-8310
UR  - https://doi.org/10.11648/j.ajomis.20180304.11
AB  - The purpose of this paper is to explore how a company’s voluntary information disclosure influences its stock price synchronicity and how the company’s financial status influences the relationship between voluntary information disclosure and stock price synchronicity. This study utilizes the panel regression model with the data of Shanghai and Shenzhen 300 Index constituent stocks from 2010 to 2017 in Chinese stock market to analyze the relationship between voluntary information disclosure and stock price synchronicity and how financial status influences the relationship. The results show that voluntary information disclosure is negatively related to stock price synchronicity. The financial status in general is likely to decrease stock price synchronicity. However the three different indictors, profitability, solvency and development ability, of financial status have different impacts on the relationship between voluntary information disclosure and stock price synchronicity. The company’s profitability strengthens the relationship of voluntary information disclosure and stock price synchronicity. While the solvency and the development ability have little impact on the relationship. It can be seen that investors are paying more attention to the intrinsic value of the companies and the quality of the Chinese stock market is obviously improving. Based on the results the paper proposes some useful suggestion in the end.
VL  - 3
IS  - 4
ER  -

Copy | Download