Heavy selling after Bonus Announcements have been made

The Peril of Chasing Bonuses:  There is strong evidence of heavy selling after bonus announcements have been made

The residual movement is strongly downward soon after a bonus announcement has been made.  This strongly suggests that there is heavy selling by some of the investors.

Who are those doing all the selling? 

The sellers certainly do not come from the general investment public since they all think that bonuses are such good deals that "they would be fools to sell out now".  It seems that the sellers can only be those who know that bonuses are not what they are made out to be and / or those who have managed to pick up shares cheaply. 

The sellers are likely to come from amongst the fundamental investors who understand the meaning of bonus and also the insiders who, knowing more than the public, must have bought shares on the cheap just before the announcement. 

As the decline is the greatest among shares which subsequently do not increase their dividend, a lot of the sellers must be insiders who know that the future of these stocks is none too bright.

Either way, the pititable smaller investors have to pay dearly for their ignorance and fascination with bonuses.