Impact of Dividend Policy on Stock Price Risk: Empirical Evidence from Equity Market of Pakistan

Muhammad Asghar (), Syed Zulfiqar Ali Shah (), Kashif Hamid () and Muhammad Tahir Suleman ()
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Muhammad Asghar: International Islamic University Islamabad
Syed Zulfiqar Ali Shah: Assistant Professor-Finance, Department of Business Administration, Faculty of Management Sciences, International Islamic University Islamabad
Kashif Hamid: Institute of Business Management Sciences, University of Agriculture Faisalabad
Muhammad Tahir Suleman: Department of Finance and Statistics Hanken - Swedish School of Economics and Business Administration PB. 287(Handelsesplanaden 2),Vaasa, Finland

Far East Journal of Psychology and Business, 2011, vol. 4 No 1 Paper 4 July, issue 4, 45-52

Abstract: This study is conducted with the objective to find out impact of dividend policy on stock price risk in Pakistan. The data of the study is taken from the published resources of State Bank of Pakistan and Karachi Stock Exchange regarding to five important sectors for the period 2005-2009. Descriptive statistics, correlation and regression models are used to perform the data analysis. The results of the study reveals that the correlation of price volatility and dividend yield is quite significant as compare to other variables. Moreover price volatility has negative correlation to the growth in assets. It is also inferred from the study that all the Variables are linked to the price Volatility; however, second model justifies the relational impact of some variables on the price volatility.

Keywords: Price volatility; dividend yield; KSE; Earning Volatility (search for similar items in EconPapers)
JEL-codes: M1 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (9)

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