The Impact Of Heterogeneous Beliefs On Shareholders Wealth Effect Based On Information Asymmetry

With the introduction of relevant policies in 2006,private placement has been gradually developed.Also,the improvement of relevant regulations also provides an institutional guarantee for private placement to expand the market scale.Due to its various advantages,such as simple procedure,low profit requirements,fast financing,the scale of private placement has increased rapidly.At present,private placement has become the most commonly used refinancing method in Chinese securities market,which has also attracted extensive attention of investors and scholars at home and abroad.However,there is no consensus on the short-term and long-term shareholder wealth effect of private placement.In view of this,this paper makes an in-depth study through the event research method.At the same time,the theoretical research on investors’ heterogeneous beliefs has become a focus in the research field.Also,since information asymmetry is widespread in the market and has an important impact on investment decisions,this paper empirically tests the impact of investors’ heterogeneous beliefs on the shareholder wealth effect of private placement based on information asymmetry.This paper elaborates the information asymmetry theory,signal transmission theory,market timing theory and agency cost theory,which lays a theoretical foundation for this study.Taking the relationship between investors’ heterogeneous beliefs and the shareholder wealth effect of private placement under information asymmetry as the research direction,this paper puts forward the research hypothesis.This paper also comprehensively combs and summarizes the literature related to information asymmetry,investors’ heterogeneous beliefs and the shareholder wealth effect of private placement,and analyzes how investors’ heterogeneous beliefs affect the shareholder wealth effect of private placement.It also analyzes the impact of investors’ heterogeneous beliefs on shareholder wealth effect under information asymmetry.This paper selects 2239 listed companies that implemented private placement from 2006 to 2018,and scientifically uses the event research method to deeply analyze the short-term and long-term shareholder wealth effects.It selects the cumulative abnormal return(CAR)and the buying and holding abnormal return(BHAR)respectively as the dependent variable,and separately sets the turnover rate and the abnormal return volatility as independent variable to measure investors’ heterogeneous beliefs.The corresponding adjustment variables is information asymmetry.The hypothesis proposed in is scientifically verified by regression analysis.The empirical analysis results are as follows.First,after the implementation of private placement,listed companies will produce a short-term positive abnormal return,while the long-term abnormal return is negative,which means that the short-term shareholder wealth effect of private placement is positive and the long-term shareholder wealth effect is negative.Second,the stronger the heterogeneous belief of investors,the higher the short-term abnormal return and the lower the long-term abnormal return.The heterogeneous belief of investors strengthens the positive short-term shareholder wealth effect and worsens the negative long-term shareholder wealth effect.Third,information asymmetry,which is common in Chinese capital market,also plays a regulatory role in this impact.Information asymmetry positively regulates the impact of investors’ heterogeneous beliefs on shareholders’ wealth effect.The results show that although private placement brings short-term positive shareholder wealth effect,the long-term market performance is poor.At the same time,under the realistic background of information asymmetry in China,heterogeneous beliefs are common,which improves the positive short-term shareholder wealth effect,but worsens the negative long-term shareholder wealth effect.In sum,the research conclusion of this paper enriches the research scope of information asymmetry and investors’ heterogeneous beliefs in the field of private placement,and plays a certain warning role for the shortsighted behavior of listed companies.