TITLE

ACCOUNTING BETAS, SYSTEMATIC OPERATING RISK, AND FINANCIAL LEVERAGE: A RISK-COMPOSITION APPROACH TO THE DETERMINANTS OF SYSTEMATIC RISK

AUTHOR(S)
Hill, Ned C.; Stone, Bernell K.
PUB. DATE
September 1980
SOURCE
Journal of Financial & Quantitative Analysis;Sep80, Vol. 15 Issue 3, p595
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
The article examines measures of systematic risk from both accounting and market-based standpoints, and investigates how systematic risk is affected by a firm's capital structure. After devising measures for financial and operating risk, the author analyzes market returns and accounting data for 240 firms over the interval 1947-1960, and 324 companies for 1961-1974. Among several key insights that emerge is that financial structure and systematic operating risk influence the variation in market betas that can be observed over successive periods.
ACCESSION #
4756551

Tags: RISK;  CAPITAL structure;  BETA (Finance);  ACCOUNTING;  FINANCIAL leverage;  CORPORATIONS -- Finance

 

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