Open AccessCapital Structure of Companies Listed at the Warsaw Stock Exchange and the COVID-19 Pandemic Effect on Their Risk
Author(s) -
Jerzy Gajdka,
Marek Szymański
Publication year - 2021
Publication title -
finanse i prawo finansowe
Language(s) - English
Resource type - Journals
eISSN - 2391-6478
pISSN - 2353-5601
DOI - 10.18778/2391-6478.4.32.10
Subject(s) - stock exchange , pandemic , business , covid-19 , systematic risk , panel data , risk management , context (archaeology) , capital structure , actuarial science , economics , demographic economics , finance , econometrics , geography , medicine , disease , archaeology , pathology , infectious disease (medical specialty) , debt
Subject: The financial management of companies is examined in the context of the COVID-19 pandemic. Specifically, the relationship between their capital structure and risk changes during the pandemic is scrutinised.
The purpose of the article: To determine how companies’ total, systematic and idiosyncratic risks changed during the COVID-19 pandemic depending on their capital structure based on a sample of organisations listed at the Warsaw Stock Exchange.
Methodology: The study involves the use of a panel data regression model.
Results of the research: The COVID-19 pandemic had an impact on the risk of overleveraged companies and underleveraged ones alike. Its influence on their total risk was weaker among the underleveraged organisations. Regarding systematic risk, its levels did not generally change significantly in the wake of the pandemic, but idiosyncratic risk, only in the case of the overleveraged companies increased statistically significantly.