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Actual share repurchases, timing and liquidity

  • Ginglinger, Edith
  • Hamon, Jacques

Research on the impact of open market share repurchases has been hindered by the lack of data available on actual share repurchases in many countries, including the US. Using a previously unused database containing detailed information on 36,848 repurchases made by 352 French firms, we show that corporate share repurchases have a significant adverse effect on liquidity as measured by bid–ask spread or depth. Our results also indicate that share repurchases largely reflect contrarian trading rather than managerial timing ability.

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Article provided by Elsevier in its journal Journal of Banking & Finance.

Volume (Year): 31 (2007)
Issue (Month): 3 (March)
Pages: 915-938

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Handle: RePEc:eee:jbfina:v:31:y:2007:i:3:p:915-938
Contact details of provider: Web page: http://www.elsevier.com/locate/jbf

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