| Summary: | 碩士 === 中國文化大學 === 會計研究所 === 91 === Because of the Asia Financial Crisis in 1997, the index of the main stock markets in the world had fallen down substantially. The Dow Jones Industrial Index in U.S. had fallen down 11% in a week. After repurchasing their stocks, the stocks prices of U.S. companies stop falling. The weighted average price index in TSEC had also declined about 3,000 points from 10,256 points in two months. In order to keep the stability of the stock market, the Taiwan’s Treasury Department decided to establish the Treasury Stock System by law. It is provided that the open traded companies can repurchase their stocks when their stocks price substantially fall down due to uneconomical reasons.
In order to identify the effects of price behavior on stock repurchases of Taiwan stock exchange listed companies. The stock price of performance following stock re-purchase from August 7, 2000 to October 25, 2002 are examined in the paper. The paper shows the post-announcement abnormal returns under the methodology of CAR, BHAR, and the benchmark portfolios of EMVBP, EVOLSP, EWRM, EMVBPRET and EVOLSPRET. In order to test the consistency and the robustness of the study, the stock performance under TSE or OTC, different industries and different purposes of repur-chases are also examed. It is indicated that the stock repurchase are associated with positive returns significantly in short run, and the TSE effects are stronger than OTC, different industries and purposes have different announcement effects, the first an-nouncement effect is stronger than others.
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