An Examination of Ex-dividend Day Stock Price Movements: The Case of Nontaxable Master Limited Partnership Distributions.
This study examines the unit (stock) price and volume behavior of master limited partnerships around the ex-dividend day. Since the dividends of master limited partnerships are not taxable to the unitholder, tax-based hypotheses predict no abnormal unit movements around the ex-day. Significant positive excess returns and volume are found before the ex-dividend day, and significant negative excess returns are found on the ex-dividend day. The findings, which are not significantly impacted by the Tax Reform Act of 1986, suggest ex-day stock movements are not solely a function of investor marginal tax rates or corporate trading behavior. Copyright 1991 by American Finance Association.
Year of publication: |
1991
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Authors: | Shaw, Wayne H |
Published in: |
Journal of Finance. - American Finance Association - AFA, ISSN 1540-6261. - Vol. 46.1991, 2, p. 755-71
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Publisher: |
American Finance Association - AFA |
Saved in:
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