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| Author | : Griffiths, Mark D |
| Publisher | : London : Western Business School, University of Western Ontario |
| Total Pages | : 36 |
| Release | : 1992 |
| Genre | : Stock exchanges |
| ISBN | : 9780771414046 |
| Author | : Josef Lakonishok |
| Publisher | : |
| Total Pages | : 39 |
| Release | : 1984 |
| Genre | : Investments |
| ISBN | : |
| Author | : Sven-Olov Daunfeldt |
| Publisher | : |
| Total Pages | : 27 |
| Release | : 2005 |
| Genre | : |
| ISBN | : |
| Author | : |
| Publisher | : |
| Total Pages | : 29 |
| Release | : 1988 |
| Genre | : Capital gains tax |
| ISBN | : |
| Author | : Margaréta Ilková |
| Publisher | : LAP Lambert Academic Publishing |
| Total Pages | : 108 |
| Release | : 2012 |
| Genre | : |
| ISBN | : 9783845423098 |
This research examines the trading behavior of investors on the French stock market during the ex-dividend period, between 2003 and 2008. The analysis of the French Tax Code confirms, the capital gains and the dividends are taxed in a different manner, hence the fiscal system creates a tax heterogeneity among different group of stockholders. Consequently, it creates an opportunity for tax-induced trading several days around the ex-date. Our empirical results show significant abnormal trading volumes during the ex-dividend period. The excess trading volumes are the most pronounced in 2003 and 2004, when the investors were heterogeneous not only with respect to the tax rates, but as well with respect to the pre-tax value of dividends. On the other hand, the lowest trading volumes are recorded in 2008 due to equilibration of capital gains and dividend taxation. Putting these three observations together, one may conclude, that in fact, some tax-motivated trading is taking place on the French stock market.
| Author | : Griffiths, Mark D |
| Publisher | : London : Research and Publications, Western Business School, University of Western Ontario |
| Total Pages | : 32 |
| Release | : 1991 |
| Genre | : |
| ISBN | : 9780771413223 |
| Author | : Paul J. Bolster |
| Publisher | : |
| Total Pages | : 37 |
| Release | : 2012 |
| Genre | : |
| ISBN | : |
The abolition of the favorable tax treatment of long term capital gains forced investors to reassess traditional year-end trading strategies used to manage tax liabilities. This study compares with year-end trading behavior in previous years with that observed at the end of 1986. Traditional strategies involve selling both short and long term losers and holding short and long term winners. Our results affirm previous findings concerning tax induced trading at year end. However, for 1986, we find that the anticipated tax code changes had a powerful effect on trading behavior. Compared to previous years, relative trading volume was considerably higher in December of 1986 for long term winners and lower for long term losers. Additional results indicate that traditional patterns of trading induced by short term capital gains and losses were also altered substantially in 1986.
| Author | : |
| Publisher | : |
| Total Pages | : |
| Release | : 1988 |
| Genre | : |
| ISBN | : |
| Author | : Paul J. Bolster |
| Publisher | : |
| Total Pages | : 29 |
| Release | : 1988 |
| Genre | : |
| ISBN | : |
| Author | : Benjamin C. Ayers |
| Publisher | : |
| Total Pages | : 39 |
| Release | : 2006 |
| Genre | : |
| ISBN | : |
We examine investor trading around the passage of the Taxpayer Relief Act of 1997 (TRA97) that reduced the capital gains tax rate from 28% to 20%. We provide evidence that individual investors increase their demand for equity shares on the announcement day of TRA97, consistent with the capitalization of capital gains taxes. On the effective day of TRA97, we find that individual investors increase the supply of equity shares with accrued gains, consistent with the lock-in effect of capital gains taxes. Regression results suggest that tax capitalization is associated with a more powerful effect on abnormal trading than the lock-in effect for the median stock trading around TRA97. Overall, our results suggest that capital gains taxes influence both the demand and supply for equity by tax sensitive investors and that the effect on demand is more pronounced than the effect on supply.
