An Analysis of Dividend Policy and Stock Price Variations in Pakistan

Abstract

The main aim of thisstudy is to examine the association between the stock price volatility (SPV) and dividend strategies of Pakistani firms listed at Pakistan Stock Exchange (PSE).The sample comprises of 200 non-financial firms for the period 2000 - 2017. Using Baskin’s framework, the stock price volatility (SPV) of the firms has been linked with dividend payment policies along with size of the firms (SF), leverage (LEV),earnings volatility (EV) and the growth of assets (GRO).Furthermore, the sway of the worldwide financial crunch on the bond between SPV and dividend policy is examined. EVexpressively describes SPV of Pakistani non-financial companies in the course of crisis period, whereas payout ratio of dividend influences volatility in pre- crisis and post-crisis sub-periods.