The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from Pakistan
This study aims to determine the effects of dividend policy on the relationship between institutional ownership and stock price volatility, based on a sample of 36 firms listed on the Karachi Stock Exchange over a seven-year period (2005–11). We use a fixed-effects model applied to panel data to in...
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| Format: | Article |
| Language: | English |
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Lahore School of Economics
2013-10-01
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| Series: | The Lahore Journal of Business |
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| Online Access: | https://journals.lahoreschool.edu.pk/LJB/LJB/article/view/13 |
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| author | Atif Hussain |
| author_facet | Atif Hussain |
| author_sort | Atif Hussain |
| collection | DOAJ |
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This study aims to determine the effects of dividend policy on the relationship between institutional ownership and stock price volatility, based on a sample of 36 firms listed on the Karachi Stock Exchange over a seven-year period (2005–11). We use a fixed-effects model applied to panel data to investigate this relationship and find that institutional ownership has a negative relation with stock price volatility and a positive relation with the dividend payout ratio. The results also show that dividend payouts significantly affect the relationship between institutional ownership and stock price volatility. The mediating role of dividend policy between institutional ownership and stock price volatility reveals that institutional investors prefer to invest in low-volatility dividend-paying stock.
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| format | Article |
| id | doaj-art-eb99a085c9a94d8a9c2503be6a155d8a |
| institution | OA Journals |
| issn | 2223-0025 2791-3139 |
| language | English |
| publishDate | 2013-10-01 |
| publisher | Lahore School of Economics |
| record_format | Article |
| series | The Lahore Journal of Business |
| spelling | doaj-art-eb99a085c9a94d8a9c2503be6a155d8a2025-08-20T01:57:54ZengLahore School of EconomicsThe Lahore Journal of Business2223-00252791-31392013-10-0121The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from PakistanAtif Hussain0The author is a doctoral candidate at Preston University in Kohat This study aims to determine the effects of dividend policy on the relationship between institutional ownership and stock price volatility, based on a sample of 36 firms listed on the Karachi Stock Exchange over a seven-year period (2005–11). We use a fixed-effects model applied to panel data to investigate this relationship and find that institutional ownership has a negative relation with stock price volatility and a positive relation with the dividend payout ratio. The results also show that dividend payouts significantly affect the relationship between institutional ownership and stock price volatility. The mediating role of dividend policy between institutional ownership and stock price volatility reveals that institutional investors prefer to invest in low-volatility dividend-paying stock. https://journals.lahoreschool.edu.pk/LJB/LJB/article/view/13Dividend policyinstitutional ownershipstock price volatilityPakistan |
| spellingShingle | Atif Hussain The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from Pakistan The Lahore Journal of Business Dividend policy institutional ownership stock price volatility Pakistan |
| title | The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from Pakistan |
| title_full | The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from Pakistan |
| title_fullStr | The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from Pakistan |
| title_full_unstemmed | The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from Pakistan |
| title_short | The Impact of Dividend Policy on the Relationship Between Institutional Ownership and Stock Price Volatility: Evidence from Pakistan |
| title_sort | impact of dividend policy on the relationship between institutional ownership and stock price volatility evidence from pakistan |
| topic | Dividend policy institutional ownership stock price volatility Pakistan |
| url | https://journals.lahoreschool.edu.pk/LJB/LJB/article/view/13 |
| work_keys_str_mv | AT atifhussain theimpactofdividendpolicyontherelationshipbetweeninstitutionalownershipandstockpricevolatilityevidencefrompakistan AT atifhussain impactofdividendpolicyontherelationshipbetweeninstitutionalownershipandstockpricevolatilityevidencefrompakistan |