Research On The Motivation Of Major Shareholders In The A-Share Market To Reduce Their Holdings

As insiders of listed companies,major shareholders have a better understanding of the company’s financial status,business prospects and inside information than small and medium-sized investors,and are more likely to influence the company’s information disclosure.In this case,major shareholders often use their own advantages to selectively reduce their holdings and encroach on the interests of small and medium-sized investors.Today,when the new regulations on reducing holdings are promulgated,the credit disclosure system and related administrative restrictions are becoming more stringent,studying the motivations of major shareholders to reduce their holdings will help small and medium-sized investors judge the trend of stock prices,and regulators will formulate corresponding policies to promote the healthy development of the stock market.This paper analyzes the motivations of major shareholders in the domestic A-share market through a combination of empirical research and case studies.In the empirical research part,this paper selects data from 2014 to 2020 for a total of 7 years and 28 quarters,and uses logistic regression model and OLS regression model to study the motivation of major shareholders to reduce their holdings.The empirical research data confirm the conservative motivation of major shareholders when reducing their holdings,confirm the effectiveness of the constraints,and conclude that:(1)the probability of major shareholders reducing their holdings is positively correlated with the level of P/E ratio,but the reduction ratio is not significantly correlated with it;(2)the proportion of major shareholders reducing their holdings is negatively correlated with expected future performance;(3)When the stock price fluctuates greatly,the major shareholder is more likely to reduce its holdings;(4)The possibility of major shareholders reducing their holdings is positively correlated with stock price performance,and the intensity of reduction is negatively correlated with macroeconomic conditions;(5)The higher the degree of equity checks and balances,the more likely it is that the majority shareholder will reduce its holdings by a small proportion;(6)The possibility and proportion of major shareholders reducing their holdings are significantly positively correlated with the equity pledge ratio;(7)The probability and proportion of major shareholders reducing their holdings are significantly constrained by the nature of shareholders and the new rules on reducing their holdings,and the inhibition of the new regulations on the reduction of holdings is mainly reflected in the reduction of holdings greater than 1%.And state-controlled companies are less likely to have major shareholders reduce their holdings.In the case analysis part,this paper uses the method of event research to study the excess returns of major shareholders’ reduction events,and conducts a case analysis of the pre-disclosure of two typical positive drivers,and the results show that the disclosure of "introduction of strategic investors" and "company capital needs" in the purpose of the reduction plan containing positive motivations has a relatively small negative impact on the stock market,so it may become a means for major shareholders to influence stock prices through information disclosure.The enlightenment from the above conclusion is that the reduction of holdings by major shareholders is ultimately an act of reducing their holdings,mostly due to conservative motives.In recent years,conservative incentives to ease the pressure of pledged debt have gradually increased.As for the reduction of positive motives such as "introducing strategic investors" and "lending funds to listed companies without interest",investors should remain rational and cautious,and regulators should also conduct targeted supervision to prevent false disclosure from infringing on the interests of investors.