A Research On High-cash-holding、Cash-holdings And Performance Of China Listed Companies

Cash is most liquid assets in the enterprise, and cash holding is not only animportant practical and theoretical issues in the modern enterprise financialmanagement activities, but also an important prerequisite for holding in enterpriseguarantee sustainable business daily activities. But cash is also the lowest profitableassets, holding cash generated high opportunity cost cannot be ignored. In order toensure normal production level and enterprise operating, it is necessary to hold somecash. How to determine the level of cash holding, the factors of cash holding, and theinfluence of cash holding to enterprise performance, etc, the scholars at home andabroad have done a great deal of research, and have suggested lots of fruitfulachievements.In the beginning, this paper collects transaction cost theory, static balance theorymodel, optimal sequence financing theory and the agency cost theory, classifies theprocessing and analysis its origin, and then we sum up the empirical research resultsat home and abroad. Through the summary and review of cash holding theoretical andempirical aspects, we construct the theoretical basis, and put forward the hypothesis.This paper is based on849listed companies from2000to2010in Shanghai andShenzhen. On the basis of research achievements at home and abroad, we analysis theinfluence of various factors about holding cash, including the agency cost, cash flow,financing costs, growth opportunities, bank loans, etc. We propose some assumptions,and construct the model, by using descriptive statistics, the correlation analysis andlinear regression statistics method, and find out the significant influence on the levelof cash holding.According to cash holding in sample companies, we define the sample into largecash holding group and control group samples, and find out the large cash holding andenterprise performance relationship. On the basis of the study, we design the cashholding and a significant influence on the part of the factors as the control variables, total assets of profit margins as the dependent variable. Through the different groupsof cash holding and company performance of the relationship between the comparisonand analysis, we can find out the relationship between cash holding and operatingresults of listed companies. According to the research conclusion: there are noobvious differences between large cash holding group and control group in theperformance of the companies, samples that large cash group didn’t bring obviousbeneficial effects in the performance of listed companies. From the point of view ofthe performance of the company, the empirical result is prone to support large cashholding the balance theory. Therefore, we draw the conclusion that there are noobvious differences between large cash holding group and control group in theperformance of the company.