| Investor is someone who will invest in a company. Before you invest in a company, investors certainly will assess how the performance of a company based on information released by the company. One of information to be obtained is the dividend. Investors expect profit of the company that is from capital gains and dividends. This study will discuss how the announcement effect of dividends on shares of the company's return on ex-dividend date. There are differences of investor reaction to dividend information. In Irrelevant Dividend Theory, dividend payments have no effect on shareholder wealth. In the theory of "Bird in the hand", the income from dividend has more value for investors than expected revenue from capital gains. Also in the "Tax Preference Theory" is said that investors prefer less preferred dividends and capital gains. The method that will be used in this research is event study and will assess whether there are abnormal returns around ex-dividend date, because of the abnormal return is the excess of actual returns with the expected return. In this study, abnormal return isn’t found on the announcement of dividend even the dividend is higher and lower, so that it can be said that investors are less affected to information on dividends on ex-dividend date. |