Effect of dividend policy on stock price volatility: evidence from Zimbabwe Stock Exchange
- Author
- Chigutei, Nisha
- Title
- Effect of dividend policy on stock price volatility: evidence from Zimbabwe Stock Exchange
- Abstract
- The primary goal of this thesis is to examine how a firm’s dividend policy correlates with share price fluctuations. The study focused on the impact of dividend policy, earnings per share, payout ratio, share price volatility, and dividend yield on the company's share value. Out of the 61 financial officers of ZSE-listed firms, only 40 responded to the questionnaires issued to them. Data analysis was done using SPSS version 20. The investigation established a connection between the dividend policy and share price volatility and furnished answers to the research questions. Findings were presented utilizing tables. Using Pearson correlation analysis, the researcher figured out that there was only a slight interrelation between share price changes and payout ratio. Furthermore, there was a negative relationship between share price and dividend yield, and the dividend yield and payout ratio of ZSE-listed firms had a minimal yet unfavorable influence on stock price volatility. The study was also able to uncover and research the connection between dividend policy and share price volatility for some ZSE-listed firms. To portray the results, tables were used. The inquiry using Pearson correlation analysis only found a weak association between the components of share price fluctuations and payout ratio. The study recommended that, for investors to effectively evaluate and distribute their funds to the most promising companies, it is essential for every company listed on ZSE to reveal details regarding their operations and performance. It is important for listed companies to recognize that even the slightest changes in dividend policy factors can significantly influence the stock prices, hence it is crucial to consider and incorporate these indicators. Thus, it is suggested that listed companies on the ZSE should strive to establish effective dividend policies that will enhance the financial gain of their shareholders.
- Date
- 2023
- Publisher
- BUSE
- Keywords
- Dividend policy
- Share price volatility
- Supervisor
- N/A
- Item sets
- Department of Accountancy
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