Actual share repurchases, timing and corporate liquidity

Hamon, Jacques; Ginglinger, Edith

Hamon, Jacques; Ginglinger, Edith (2004), Actual share repurchases, timing and corporate liquidity, FMA Europe (Financial Management Association International), 2004, Zurich, Suisse

Type

Communication / Conférence

Date

2004

Conference title

FMA Europe (Financial Management Association International)

Conference date

2004

Conference city

Zurich

Conference country

Suisse

Metadata

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Author(s)

Hamon, Jacques
Ginglinger, Edith

Abstract (EN)

Research on the impact of open market share repurchases has been hindered by the lack of dataavailable on actual share repurchases in many countries, including the US. Using a previouslyunused database containing detailed information on 36,848 repurchases made by 352 French firms,we show that corporate share repurchases have a significant adverse effect on liquidity as measuredby bid–ask spread or depth. Our results also indicate that share repurchases largely reflect contrariantrading rather than managerial timing ability.

Subjects / Keywords

Repurchase; Open market; Euronext Paris; Liquidity; Timing

JEL

G14 - Information and Market Efficiency; Event Studies; Insider Trading
G32 - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
G35 - Payout Policy