Stock price determination has always been considered a phenomenon of interest around the globe. Lately, an increased fluctuation has been witnessed in the stock prices and this is the case in Pakistan as well. Apart from that, there is absence of evidence in Pakistan on the phenomenon. This paper is an attempt to explain stock price volatility in Pakistan using Baskin (1989) model. The findings of the study entail that dividend yield and dividend payout have negative impact on stock price volatility with a moderate significance in overall sample representing KSE 100 companies. Further, earning volatility was found to have a positive and significant impact on earnings volatility. The variables lost their significance for financial sector of Pakistan, while in non-financial sector variables of dividend payout, earning volatility and asset growth have a significant impact on stock price volatility. This study highlights the needs for development of alternative models that might have better explanatory power with regard to determination of stock price volatility in Pakistan.

Stock price determination has always been considered a phenomenon of interest around the globe. Lately, an increased fluctuation has been witnessed in the stock prices and this is the case in Pakistan as well. Apart from that, there is absence of evidence in Pakistan on the phenomenon. This paper...