We examine stock prices and the number of stocks traded around ex-dividend dates of German stocks with tax …-free dividend. Tax-free dividends are temporarily tax-exempt, as they reduce the initial purchasing price of a stock. With our … empirical results indicate that ex-date prices decline, on average, by the amount of the dividend. We do not find a significant …

classical system. Theory suggests that both price drop ratios and trading volume decrease following the reform. We document a … signi cant reduction in the valuation of net dividends - in particular for high dividend yield stocks - and weakening payout … policy tax clienteles. Ex-dividend day returns are likely to be driven by short-term traders. Though the reform removed …