Notice of RetractionInsider trading, institutional holding and performance of the capital reduction companies

Notice of Retraction

After careful and considered review of the content of this paper by a duly constituted expert committee, this paper has been found to be in violation of IEEE\´s Publication Principles.

We hereby retract the content of this paper. Reasonable effort should be made to remove all past references to this paper.

The presenting author of this paper has the option to appeal this decision by contacting TPII@ieee.org.

To improve the company\´s financial structure, "capital reduction" became the way which the company operators often use. Capital reduction, that is, the company through the statutory procedures to remove equity to reduce capital. This study discusses the relationships among the internal ownership changing, institutional ownership changing and performance of the capital reduction companies. The period is 1997–2009. First, we find that, capital-reduction company\´s stock return will bring abnormal return before half year. Second, insider know more information than institutional investors, thus, institutional investors\´ skill is not good we think.