Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs

This study examines the impacts of company diversification strategy on crash risk of stock price with emphasis on agency costs in the companies listed in the Tehran Stock Exchange, TSE. To proceed with research objectives, 120 companies in the TSE were selected for the period 2009-2014. To measure d...

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Autores principales:	Rasoul Baradaran Hassanzadeh (Ph.D), Vahid Taghizadeh Khanqah
Formato:	article
Lenguaje:	FA
Publicado:	Shahid Bahonar University of Kerman 2018
Materias:	corporate diversification strategy crash risk of stock price agency costs Accounting. Bookkeeping HF5601-5689
Acceso en línea:	https://doaj.org/article/5c2d7ce339aa42109be68241e4fccaea
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spelling	oai:doaj.org-article:5c2d7ce339aa42109be68241e4fccaea2021-11-04T19:53:43ZImpacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs2008-89142476-292X10.22103/jak.2018.9873.2330https://doaj.org/article/5c2d7ce339aa42109be68241e4fccaea2018-04-01T00:00:00Zhttps://jak.uk.ac.ir/article_1931_eef4830bea06eeed843ee3d7e0690e37.pdfhttps://doaj.org/toc/2008-8914https://doaj.org/toc/2476-292XThis study examines the impacts of company diversification strategy on crash risk of stock price with emphasis on agency costs in the companies listed in the Tehran Stock Exchange, TSE. To proceed with research objectives, 120 companies in the TSE were selected for the period 2009-2014. To measure diversification strategy, Herfindahl index and entropy index were used, and to measure crash risk of stock price, negative conditional skewness of firm-specific monthly returns and down-to-up volatility measure were used. Panel data method was applied to the tests of hypotheses. The results showed that company's diversification strategy has positive and significant effects on crash risk of stock price. Also, after dividing the companies into two groups of companies with high and low agency costs, the impact of the company diversification strategy on crash risk of stock price were examined distinctly. The results showed that the positive impact of company's diversification strategy on crash risk of stock price in companies with high agency costs is intensive.Rasoul Baradaran Hassanzadeh (Ph.D)Vahid Taghizadeh KhanqahShahid Bahonar University of Kermanarticlecorporate diversification strategycrash risk of stock priceagency costsAccounting. BookkeepingHF5601-5689FAمجله دانش حسابداری, Vol 9, Iss 1, Pp 63-90 (2018)
institution	DOAJ
collection	DOAJ
language	FA
topic	corporate diversification strategy crash risk of stock price agency costs Accounting. Bookkeeping HF5601-5689
spellingShingle	corporate diversification strategy crash risk of stock price agency costs Accounting. Bookkeeping HF5601-5689 Rasoul Baradaran Hassanzadeh (Ph.D) Vahid Taghizadeh Khanqah Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs
description	This study examines the impacts of company diversification strategy on crash risk of stock price with emphasis on agency costs in the companies listed in the Tehran Stock Exchange, TSE. To proceed with research objectives, 120 companies in the TSE were selected for the period 2009-2014. To measure diversification strategy, Herfindahl index and entropy index were used, and to measure crash risk of stock price, negative conditional skewness of firm-specific monthly returns and down-to-up volatility measure were used. Panel data method was applied to the tests of hypotheses. The results showed that company's diversification strategy has positive and significant effects on crash risk of stock price. Also, after dividing the companies into two groups of companies with high and low agency costs, the impact of the company diversification strategy on crash risk of stock price were examined distinctly. The results showed that the positive impact of company's diversification strategy on crash risk of stock price in companies with high agency costs is intensive.
format	article
author	Rasoul Baradaran Hassanzadeh (Ph.D) Vahid Taghizadeh Khanqah
author_facet	Rasoul Baradaran Hassanzadeh (Ph.D) Vahid Taghizadeh Khanqah
author_sort	Rasoul Baradaran Hassanzadeh (Ph.D)
title	Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs
title_short	Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs
title_full	Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs
title_fullStr	Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs
title_full_unstemmed	Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs
title_sort	impacts of company diversification strategy on crash risk of stock price with emphasis on agency costs
publisher	Shahid Bahonar University of Kerman
publishDate	2018
url	https://doaj.org/article/5c2d7ce339aa42109be68241e4fccaea
work_keys_str_mv	AT rasoulbaradaranhassanzadehphd impactsofcompanydiversificationstrategyoncrashriskofstockpricewithemphasisonagencycosts AT vahidtaghizadehkhanqah impactsofcompanydiversificationstrategyoncrashriskofstockpricewithemphasisonagencycosts
_version_	1718444592615915520

Impacts of Company Diversification Strategy on Crash Risk of Stock Price with Emphasis on Agency Costs

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