Research On Event Driven Investment Strategy Based On Stock Incentives

There are various strategies for investing in the secondary market,and the event-driven strategy is an investment strategy that is widely favored by investors and is very effective.This article selects equity incentives that are less concerned by investors as the driving event of the event-driven strategy to verify that the listed company's share price after the implementation of equity incentives has obvious excess returns,and proposes corresponding investment strategies.The formulation and implementation of equity incentives are closely linked with the performance of the company:Firstly,employees will link their own earnings with the performance of the company due to equity incentives,and fully exert their subjective initiative in order to obtain excess returns,and work hard in the long-term interests of the company.Secondly,whether the employee can obtain the right to the gains granted by equity incentives also depends on whether the company's performance improvement meets the criteria set by the incentive plan.Therefore,these two factors determine the positive effect of equity incentives on the stock price of the company.The research method of this article mainly adopts the event research method to discuss the impact of the incident on the stock price of the sample company,and uses the statistical analysis method to test the significance of the event.And then,the method of quantitative investment is used to propose an event-driven strategy and back test.Finally,it is concluded that after the listed company implements the equity incentive,the company's stock price has a significant positive excess return on the event day and reaches the maximum value on the third trading day.According to the classification of the companies based on the types of equity incentives,it is found that companies that adopt restricted stock models to implement equity incentives have more accumulated excess returns than companies that adopt stock option models.Then based on the empirical results,it proposes to purchase the stocks of listed companies that have implemented restricted stock incentives on the event day and sell them after three trading days,and then back test the strategy and put forward corresponding investment advice.