The Effect of Managerial Ownership on Stock Split-Induced Abnormal Returns

Samuel H Szewczyk and George P Tsetsekos

The Financial Review, 1993, vol. 28, issue 3, 351-70

Abstract: This paper tests the proposition that split announcements are informative signals that play a greater information role for widely held firms. We present evidence for an inverse relationship between managerial ownership and the magnitude of stock split-induced abnormal returns. After controlling for industry and firm size, we find that splitting firms have lower managerial ownership, on average, than nonsplitting firms. We also find no evidence that managers trade on inside information prior to announcing splits. Copyright 1993 by MIT Press.

Date: 1993
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Persistent link: https://EconPapers.repec.org/RePEc:bla:finrev:v:28:y:1993:i:3:p:351-70

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