Debt Maturity And Stock Returns: An Inter-Sectoral Comparison Of Malaysian Firms
This firm-level study examines whether the effects of financial leverage on stock returns of 12 Bursa Malaysian sectors can be explained by debt maturity. When total leverage is used, only 3 out of 12 sectors exhibit a significant relationship with stock returns. However, when the leverage...
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
Asian Academy of Management (AAM)
2016
|
| Subjects: | |
| Online Access: | http://eprints.usm.my/37213/1/aamjaf12022016_3.pdf |
| _version_ | 1825833616789209088 |
|---|---|
| author | Wei, Theng Lau Siong , Hook Law Md Nassir, Annuar |
| author_facet | Wei, Theng Lau Siong , Hook Law Md Nassir, Annuar |
| author_sort | Wei, Theng Lau |
| collection | USM |
| description | This firm-level study examines whether the effects of financial leverage on stock returns
of 12 Bursa Malaysian sectors can be explained by debt maturity. When total leverage is
used, only 3 out of 12 sectors exhibit a significant relationship with stock returns. However,
when the leverage is divided by using short-term and long-term debt, regressions in 9
out of 12 sectors reveal that either form of disaggregated leverage exhibits a significant
relationship with returns at least at a 5% significance level. The results suggest that the
return-leverage relationship could be indirect in terms of maturity. The panel regressions
also show that sector-specific analysis is more meaningful and practical due to the mixed
relationship identified. The empirical conclusions are further supported by using two
indicators of financial leverage, i.e. book leverage and market leverage. The results are
robust when the firm and the time effects are taken into consideration |
| first_indexed | 2024-03-06T15:10:30Z |
| format | Article |
| id | usm.eprints-37213 |
| institution | Universiti Sains Malaysia |
| language | English |
| last_indexed | 2024-03-06T15:10:30Z |
| publishDate | 2016 |
| publisher | Asian Academy of Management (AAM) |
| record_format | dspace |
| spelling | usm.eprints-372132017-10-20T00:56:43Z http://eprints.usm.my/37213/ Debt Maturity And Stock Returns: An Inter-Sectoral Comparison Of Malaysian Firms Wei, Theng Lau Siong , Hook Law Md Nassir, Annuar HD28-70 Management. Industrial Management This firm-level study examines whether the effects of financial leverage on stock returns of 12 Bursa Malaysian sectors can be explained by debt maturity. When total leverage is used, only 3 out of 12 sectors exhibit a significant relationship with stock returns. However, when the leverage is divided by using short-term and long-term debt, regressions in 9 out of 12 sectors reveal that either form of disaggregated leverage exhibits a significant relationship with returns at least at a 5% significance level. The results suggest that the return-leverage relationship could be indirect in terms of maturity. The panel regressions also show that sector-specific analysis is more meaningful and practical due to the mixed relationship identified. The empirical conclusions are further supported by using two indicators of financial leverage, i.e. book leverage and market leverage. The results are robust when the firm and the time effects are taken into consideration Asian Academy of Management (AAM) 2016 Article PeerReviewed application/pdf en http://eprints.usm.my/37213/1/aamjaf12022016_3.pdf Wei, Theng Lau and Siong , Hook Law and Md Nassir, Annuar (2016) Debt Maturity And Stock Returns: An Inter-Sectoral Comparison Of Malaysian Firms. Asian Academy of Management Journal of Accounting and Finance, 12 (2). pp. 1-27. ISSN 1823-4992 http://web.usm.my/journal/aamjaf/aamjaf12022016/aamjaf12022016_3.pdf |
| spellingShingle | HD28-70 Management. Industrial Management Wei, Theng Lau Siong , Hook Law Md Nassir, Annuar Debt Maturity And Stock Returns: An Inter-Sectoral Comparison Of Malaysian Firms |
| title | Debt Maturity And Stock Returns:
An Inter-Sectoral Comparison Of
Malaysian Firms |
| title_full | Debt Maturity And Stock Returns:
An Inter-Sectoral Comparison Of
Malaysian Firms |
| title_fullStr | Debt Maturity And Stock Returns:
An Inter-Sectoral Comparison Of
Malaysian Firms |
| title_full_unstemmed | Debt Maturity And Stock Returns:
An Inter-Sectoral Comparison Of
Malaysian Firms |
| title_short | Debt Maturity And Stock Returns:
An Inter-Sectoral Comparison Of
Malaysian Firms |
| title_sort | debt maturity and stock returns an inter sectoral comparison of malaysian firms |
| topic | HD28-70 Management. Industrial Management |
| url | http://eprints.usm.my/37213/1/aamjaf12022016_3.pdf |
| work_keys_str_mv | AT weithenglau debtmaturityandstockreturnsanintersectoralcomparisonofmalaysianfirms AT sionghooklaw debtmaturityandstockreturnsanintersectoralcomparisonofmalaysianfirms AT mdnassirannuar debtmaturityandstockreturnsanintersectoralcomparisonofmalaysianfirms |