Open AccessThe Measurement of Impacts of External Financing on The Risk Level of Viet Nam Construction Material Industry During and After The Global Crisis 2007-2011
Author(s) -
Dinh Trần Ngọc Huy
Publication year - 2013
Publication title -
international journal of management excellence
Language(s) - English
Resource type - Journals
ISSN - 2292-1648
DOI - 10.17722/ijme.v1i3.41
Subject(s) - leverage (statistics) , financial crisis , business , equity (law) , viet nam , finance , corporate governance , financial system , financial economics , economics , economy , machine learning , computer science , political science , law , macroeconomics
This research paper aims to analyze the impacts of external financing on market risk for the listed firms in the Viet nam construction material industry, esp. after the financial crisis 2007-2009.
First, by using quantitative and analytical methods to estimate asset and equity beta of total 57 listed companies in Viet Nam construction material industry with a proper traditional model, we found out that the beta values, in general, for many institutions are acceptable.
Second, under 3 different scenarios of changing leverage (in 2011 financial reports, 30% up and 20% down), we recognized that the risk level, measured by equity and asset beta mean, decreases when leverage increases to 30% and vice versa.
Third, by changing leverage in 3 scenarios, we recognized the dispersion of risk level increases (measured by equity beta var) if the leverage increases to 30%.
Finally, this paper provides some outcomes that could provide companies and government more evidence in establishing their policies in governance.