The annual interest rate of time savings deposits in traditional financial institutions is only about 1% currently. With little interest, investors choose the stock market to invest and choose companies with high dividend yields, such as financial stocks, to increase their income. During the period of financial crisis, because financial industries are highly regulated and are subject to highly strict supervision by government agencies, the probability of default or deviation from policy is low. Therefore, investors trust financial stocks more than others. In addition, financial stocks have a long-term and stable dividend payout policy. Investors can not only receive dividends regularly, but also create greater value under the effect of compound interest over time. Therefore, this study takes Taiwan's financial industry as the research object and adopts the event study method to explore whether the stock price generate abnormal returns and abnormal trading volume on the announcement date of cash dividend distribution. The empirical results showed that there are positive and significant cumulative abnormal returns and cumulative abnormal turnover ratios on the day of the announcement of cash dividends. Investors hold a positive view of the payout of dividends in the financial industry, and the impact on shareholder wealth is positive. This result also showed that investors are bullish and bullish on financial stocks in terms of returns or trading volume in Taiwan stock market transactions, which have the advantages of high liquidity and stability. Comparing to the fixed deposit of traditional financial institutions, depositors can earn more returns if they hold the financial stocks for a long term.
