Research On The Motivation And Effect Of The "Risk-free" Shareholding Increasing Of Listed Companies

China’s stock market suffered a sharp drop in mid-2015 and the Shanghai Composite Index dropped by 35% within one month.The securities market suffered heavy losses.In order to stabilize the stock market,the government has introduced a series of rescue measures.At the same time,listed companies have also taken actions to rescue the market on their own,and the ‘Risk-free Shareholding Increasing’ was formally created in this background.As an emerging means of saving the market,can the ‘Risk-free Shareholding Increasing’ really achieve the effect of saving the stock price? In the case of imperfect regulatory systems,Is the major shareholders’ ‘Risk-free Shareholding Increasing’ really aimed at bailing out the market? This thesis uses the event research method to study the short-term effects of ‘Risk-free Shareholding Increasing’ and discussed the motivations and effects of typical cases to answer the above questions,so as to provide investors with a rational view of this behavior and offer regulatory authorities references to strengthen the supervision of related behaviors.Based on analyzing related theories and literature,this thesis discusses the causes,development,frequency and scale of ‘Risk-free Shareholding Increasing’ in China.Meantime,this thesis uses the event research method to calculate and analyze the short-term impact of ‘Risk-free Shareholding Increasing’ on the market.Then,the author takes GUANGDONG BIOLIGHT MEDITECH CO.,LTD.as a case study analyzed the motivation and effect of the company’s ‘Risk-free Shareholding Increasing’.This thesis adopts efficient market hypothesis,market timing hypothesis,signal transmission hypothesis and information asymmetry theory to analyze the motives of the company’s ‘Risk-free Shareholding Increasing’,using the event research method to observe the impact of events on the company’s stock price,in order to analyze the short-term impact of ‘Risk-free Shareholding Increasing’ on the company;For the analysis of long-term effects,the author uses financial indicator analysis to evaluate the company’s performance after ‘Risk-free Shareholding Increasing’Through a case study,this article finds that in addition to bailing out the market,GUANGDONG BIOLIGHT MEDITECH CO.,LTD.’s also aimed to attract investment and prevent the liquidation of pledged equity by adopting ‘Risk-free Shareholding Increasing’.The ‘Risk-free Shareholding Increasing’ has played a role in raising the company’s stock price in an extreme short term,but in the long-term It seems that the comprehensive capabilities of the enterprise cannot be improved.The conclusion is that ‘Risk-free Shareholding Increasing’,a pure speculation that lacks sufficient actual performance or profitability to support,can only have a very short-term impact on the company’s stock price,and cannot improve the company’s long-term comprehensive capabilities.Finally,in response to the problems found in the case study process,this thesis recommends that investors to be rational and avoid following the trend of investment.Enterprises should pay more attention to the development of actual performance.Regulators should improve relevant regulations and refine information disclosure requirements.