Impact of Dividend Payout on Share Price Volatility

Abstract

Appropriate dividend distribution policy can not only set a good corporate image, but also to build the confidence of investors in the company's future prospects, thus creating a good corporate financing environment, the company long-term stable development. This  paper is an attempt to analysis the impact of dividend payout on share price volatility. Here 15 listed hotel and travel companies are selected for this research on random sampling method. SPSS 16 used for analysis. Analyzed results revealed Dividend payout, Net assets per share and Earning per share statistically significantly predict the Share price Volatility, F(3, 126) = 14.613, p < .05. This results shows that Dividend payout has significant positive impact on share price changes p<0.01 and 25.8% of variability of share price explain by Dividend payout.further correlation analysis resuls revealed that  there is positive significant relationship between  dividend payout and share price volatility. Therefore this study recommeded to selected companies to concentrate on distribution of income which influences on share holdes’ wealth.

Keywords: dividend payout, share price volatility, net asset per share, Earning per share