The relationship between the percentages of free float and liquidity of shares of companies in the Philippine Stock Exchange

• Main Authors: Co, Erin Benedict, Chua, Alec Jayson, Gonzalo, Patricia Mae, Sy, Nyra Beatrice.
• Format: text
• Language: English
• Published: Animo Repository 2017
• Subjects: Stock exchanges > Philippines; Stocks > Philippines; Finance and Financial Management
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/9019
• Institution: De La Salle University

Free float shares, also known as public shares, is the amount of shares publicly available for trading. Since 2012, a minimum public ownership (MPO) requirement has been imposed by the Philippine Securities and Exchange Commission (SEC). Before its implementation, most public companies had low free float meaning that there is only a limited number of public shares. Through the use of time series linear regression, the effects of free float to market liquidity of stocks were tested. This study made use of share turnover ratio, number of transactions, and volume as indicators of market liquidity. Results show that there is a significant relationship between percentages of free float and market liquidity of shares.