Research Paper
Year: 2019 | Month: August | Volume: 6 | Issue: 8 | Pages: 243-251
Analysis of Information Content in the Event of Stock Split on the Indonesia Stock Exchange
Pendy1, Dr. Isfenti Sadalia2, Dr. Amlys Syahputra Silalahi3
1,2,3Master of Management, Universitas Sumatera Utara, Indonesia
Corresponding Author: Pendy
ABSTRACT
The objective of the research is to analyze information content in the event of stock split which is reflected through the difference in stock price, abnormal return, and trading volume activity before and after the stock split. Secondary data are used in this research and are obtained from the publication of IDX website. Observation period takes 15 days: 7 days before the event, 1 day during the event, and 7 days after the event. The population consists of 34 companies conducting stock split during January 2017 till October 2018. There are 31 companies selected as samples using purposive sampling technique. Paired t-test is used to analyzed the data. The result shows the prices will differ positively and significantly during the date of stock split till 2 days afterwards, meanwhile it’s found out there are no significant differences for abnormal return and trading volume activity after the event of stock split.
Key words: abnormal return, stock price, information content, stock split, purposive sampling, trading volume activity
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