The Impact of Dividend Policy Preferences on Stock Returns in China A-shape Market

In this paper, we studied the impact of dividend policy preferences on stock returns of different maturities in China A-sharp market. After classifying all the sample companies according to dividend policy preferences, scales and book-to-market ratios, we used Mann-Whitney test to find the relationship between the dividend policy preferences and the stock returns. In the period 2001.7-2010.6, few Chinese listed companies preferred paying stock bounds but many ones preferred paying either cash dividends or not paying dividends. Companies preferring paying dividends always have higher stock returns than those ones not preferring paying dividends. Further more, preferring mixed dividends could brings higher stock returns in large companies but lower in small companies than preferring cash dividends. Finally, we found that the above conclusions always hold in the cases of choosing different maturities.