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The Impact of Capital Structure on Stock Returns: International Evidence

Author

Listed:
  • Reza TAHMOORESPOUR

    (University Putra Malaysia)

  • Mina ALI-ABBAR

    (University Putra Malaysia)

  • Elias RANDJBARAN

    (University Putra Malaysia)

Abstract

This study examines the relationship between capital structure and stock returns of firms in the following eight countries in the Asia Pacific regionfor a period of 22 years from 1990 to 2012. The methodology is Panel Regression. The results indicate that the effect of capital structure depends on the nature of industry as well as market. In Australia, China, and Korea, return of companies in the Basic Material industry have negative relationship with debt to common equity. Long term debt to common equity positively affects the return of firms in Australia and Korea in the Basic Material industry.

Suggested Citation

  • Reza TAHMOORESPOUR & Mina ALI-ABBAR & Elias RANDJBARAN, 2015. "The Impact of Capital Structure on Stock Returns: International Evidence," Hyperion Economic Journal, Faculty of Economic Sciences, Hyperion University of Bucharest, Romania, vol. 3(1), pages 56-78, March.
    • Handle: RePEc:hyp:journl:v:3:y:2015:i:1:p:56-78
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    Cited by:

    1. Xi, Xian & Gao, Xiangyun & Zhou, Jinsheng & Zheng, Huiling & Ding, Jiazheng & Si, Jingjian, 2021. "Uncovering the impacts of structural similarity of financial indicators on stock returns at different quantile levels," International Review of Financial Analysis, Elsevier, vol. 76(C).

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