Long-term stock performance after open-market repurchases in Korea

This study examines the long-term performance of the stock of firms that announce open-market repurchases in Korea. We find essentially no evidence of long-term abnormal performance. Thus, our results provide strong support for the efficient market hypothesis with regard to open-market repurchases in Korea. A factor that may be contributing to this finding is that Korean firms must complete announced repurchases within 3 months. Hence, our sample, since it is relatively free of potentially confounding effects of ongoing repurchase activity, provides a cleaner test of the efficient market hypothesis than the samples in existing studies. (C) 2005 Elsevier Inc. All rights reserved.