Cluster Analysis of Financial Strategies of Companies
Measuring the value of companies and assessing their risk often relies on econometric methods that consider companies as a set of objects under study, homogeneous in the sense of their use of financial strategies. This paper shows that cluster analysis methods can divide companies into classes accor...
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| Format: | Article |
| Language: | English |
| Published: |
MDPI AG
2021-12-01
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| Series: | Mathematics |
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| Online Access: | https://www.mdpi.com/2227-7390/9/24/3192 |
| _version_ | 1797502676128235520 |
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| author | Sergey Dzuba Denis Krylov |
| author_facet | Sergey Dzuba Denis Krylov |
| author_sort | Sergey Dzuba |
| collection | DOAJ |
| description | Measuring the value of companies and assessing their risk often relies on econometric methods that consider companies as a set of objects under study, homogeneous in the sense of their use of financial strategies. This paper shows that cluster analysis methods can divide companies into classes according to financial strategies that they employ. This indicates that homogeneity can be considered within these classes, while between-class companies should rather be perceived as heterogeneous. The clustering of companies has to be performed on quite a dense set of strategies, which requires a combination of formal and heuristic methods. To divide companies into classes, we used financial coefficients characterizing strategies for the 2030 largest non-financial companies within the time period from 2006 to 2018. As a result, a stable division into seven clusters/strategies was obtained. We revealed that some strategies were more characteristic for the companies of high-tech economy, while others were typical for the companies in basic industries. The dynamics of clusters is characterized by an increase in the share of risky strategies. A good meaningful interpretation of the resulting clustering confirms its consistency. The identified clusters can be used as dummy variables in econometric studies of companies to improve the quality of the results. |
| first_indexed | 2024-03-10T03:38:30Z |
| format | Article |
| id | doaj.art-cbf2929987a343729de6ea54525b582f |
| institution | Directory Open Access Journal |
| issn | 2227-7390 |
| language | English |
| last_indexed | 2024-03-10T03:38:30Z |
| publishDate | 2021-12-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Mathematics |
| spelling | doaj.art-cbf2929987a343729de6ea54525b582f2023-11-23T09:25:29ZengMDPI AGMathematics2227-73902021-12-01924319210.3390/math9243192Cluster Analysis of Financial Strategies of CompaniesSergey Dzuba0Denis Krylov1FEFU Campus, Far Eastern Federal University, 10 Ajax Bay, Russky Island, 690922 Vladivostok, RussiaFEFU Campus, Far Eastern Federal University, 10 Ajax Bay, Russky Island, 690922 Vladivostok, RussiaMeasuring the value of companies and assessing their risk often relies on econometric methods that consider companies as a set of objects under study, homogeneous in the sense of their use of financial strategies. This paper shows that cluster analysis methods can divide companies into classes according to financial strategies that they employ. This indicates that homogeneity can be considered within these classes, while between-class companies should rather be perceived as heterogeneous. The clustering of companies has to be performed on quite a dense set of strategies, which requires a combination of formal and heuristic methods. To divide companies into classes, we used financial coefficients characterizing strategies for the 2030 largest non-financial companies within the time period from 2006 to 2018. As a result, a stable division into seven clusters/strategies was obtained. We revealed that some strategies were more characteristic for the companies of high-tech economy, while others were typical for the companies in basic industries. The dynamics of clusters is characterized by an increase in the share of risky strategies. A good meaningful interpretation of the resulting clustering confirms its consistency. The identified clusters can be used as dummy variables in econometric studies of companies to improve the quality of the results.https://www.mdpi.com/2227-7390/9/24/3192cluster analysispattern analysiscluster silhouettefinancial strategy of the firm |
| spellingShingle | Sergey Dzuba Denis Krylov Cluster Analysis of Financial Strategies of Companies Mathematics cluster analysis pattern analysis cluster silhouette financial strategy of the firm |
| title | Cluster Analysis of Financial Strategies of Companies |
| title_full | Cluster Analysis of Financial Strategies of Companies |
| title_fullStr | Cluster Analysis of Financial Strategies of Companies |
| title_full_unstemmed | Cluster Analysis of Financial Strategies of Companies |
| title_short | Cluster Analysis of Financial Strategies of Companies |
| title_sort | cluster analysis of financial strategies of companies |
| topic | cluster analysis pattern analysis cluster silhouette financial strategy of the firm |
| url | https://www.mdpi.com/2227-7390/9/24/3192 |
| work_keys_str_mv | AT sergeydzuba clusteranalysisoffinancialstrategiesofcompanies AT deniskrylov clusteranalysisoffinancialstrategiesofcompanies |