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The E?ect of Financial Ratios on the Stock Prices: Evidence from the Polish Stock Exchange

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  • Marie Ligocka

    (Silesian University in Opava, School of Business Administration in Karvina)

Abstract

Stock prices can be influenced by many factors; the macroeconomic factors, industrial specifics and company characteristics are three main categories. The object of this paper is to analyze relationship between selected financial ratios and stock prices of the food, energy, metallurgical and chemical companies listed on the Polish Stock Exchange (Gie³da Papierów Wartoœciowych w Warszawie, GPW) over the 2006–2015 period. The Johansen test that investigates long-term equilibrium between stock prices and financial ratios is used. The short-run dynamics of the long-term equilibrium relationship will be examined using the Vector Error Correction Model (VECM). The panel regression method that analyze relationships between data set in two-dimensional space follows. The findings indicate the impact of the rentability, the liquidity and the financial leverage to the selected stock prices of companies listed on the GPW.

Suggested Citation

  • Marie Ligocka, 2019. "The E?ect of Financial Ratios on the Stock Prices: Evidence from the Polish Stock Exchange," ACTA VSFS, University of Finance and Administration, vol. 13(1), pages 44-60.
  • Handle: RePEc:prf:journl:v:13:y:2019:i:1:p:44-60
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    References listed on IDEAS

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    Cited by:

    1. Sufian Radwan Al-Manaseer, 2020. "Impact of Market Ratios on the Stock Prices: Evidence from Jordan," International Business Research, Canadian Center of Science and Education, vol. 13(4), pages 1-92, April.

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    More about this item

    Keywords

    financial ratios; cointegration; Poland; industry; stock exchange; panel regression;
    All these keywords.

    JEL classification:

    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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