Abstract
This study aims to look at the effect of the corporate action against trading on the Stock Exchange be something interesting to do research on five companies that perform corporate actions. Data were analyzed using descriptive methods and comparative analysis of the event study method with a different test two parties. Event windows use 15 days prior to the corporate action and 15 days after the corporate action. Results of research on five companies that perform corporate actions earned actions stock buy-backs, stock-dividend and stock split no significant effect on actual returns after the announcement date. On the trading frequency, action stock-buyback have significant differences, whereas stock dividend and stock-split not. On average trading value, action stock-dividend and stock-buyback not any significant difference, while stock-split showed a significant difference. The study results are not normal events of their return on stock dividends 7 days after the date of announcement of the action stock-split-return normal not occur on days 3 and 4, while on the corporate action buy-back not occur. Stock-dividend while the information content contained in stock-split and buy-back did not show a significant investor reaction.
Highlights
The capital market has a major role for the economy because capital markets have two functions, namely the function of the economic and financial functions
T-count value of 0.653 with sig. 0.524> 0:10 we conclude that H0 is accepted, meaning that on average return before and after the corporate action stock buyback are the same declared, corporate actions undertaken by the company do not affect return shares traded in the capital market
Upper Frequency Trading T-count value amounted to 1,951 with sig. 0,071
Summary
The capital market has a major role for the economy because capital markets have two functions, namely the function of the economic and financial functions. The capital market is said to have an economic function for providing facilities or the vehicle that brings the two interests, namely those who have excess funds ( investors) and those who need the funds (issuer). The capital market is said to have a financial function as the capital market provides the possibility and the opportunity to earn rewards ( return) for the owner of the funds in accordance with the characteristics of the selected investments. Value Composite Stock Price Index in the last 10 years has increased up to 388% or more than 30% per year. Stock price increase per year is much higher than the average annual inflation in the amount of 10%
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