The cash conversion cycle spread in China

Xin Chen, Gaoping Zheng and Daniel Chai

Pacific-Basin Finance Journal, 2022, vol. 73, issue C

Abstract: We investigate the relation between the cash conversion cycle (CCC) and the cross section of stock returns in the US and Chinese markets. By replicating the main results of Wang (2019), we find no evidence of the CCC effect in the Chinese market over the sample period 2002–2019. The results remain robust when microcap stocks are excluded from the sample. We also find that the components of the CCC play different roles in stock returns between the two markets. Further analysis shows that the CCC effect mainly exists in periods before 2002 in the US market. This suggests that the results of Wang (2019) may be sample specific.

Keywords: Cash conversion cycle; Stock returns; Asset pricing; Chinese market (search for similar items in EconPapers)
JEL-codes: G10 G12 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:73:y:2022:i:c:s0927538x22000646

DOI: 10.1016/j.pacfin.2022.101769

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