Investigating the Relationship between Working Capital Management and Stock Price Crash Risk

UKH Journal of Social Sciences

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Field Value
 
Title Investigating the Relationship between Working Capital Management and Stock Price Crash Risk
 
Creator Mansoori, Ebrahim
Elyasi, Masood
Mohammadi, Rahim
 
Description The main purpose of this study is to investigate the effect of working capital management on stock price crash risk. The sample includes 103 Iranian firms listed on the Tehran Stock Exchange from 2013 to 2017. Panel data analysis with fixed effect estimation has been used to analyze the relationship between working capital management and stock price crash risk. Cash conversion cycle, working capital requirement, current, and quick ratios were applied as comprehensive measures for working capital management, and Hutton’s model was applied as a measure for stock price crash risk. The results indicate that there is a negative relationship between working capital indicators and stock price crash risk. Therefore, managers can use working capital strategies to decrease the risk of the stock price crash. Furthermore, asymmetry information may, in fact, increase a manager’s incentive to use working capital strategies to reduce the stock price crash risk.
 
Publisher University of Kurdistan Hewlêr
 
Date 2019-05-23
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Research Article
 
Format application/pdf
 
Identifier https://journals.ukh.edu.krd/index.php/ukhjss/article/view/92
10.25079/ukhjss.v3n1y2019.pp28-35
 
Source UKH Journal of Social Sciences; Vol 3 No 1 (2019): ISSUE FOUR; 28-35
2520-7806
10.25079/ukhjss.v3n1y2019
 
Language eng
 
Relation https://journals.ukh.edu.krd/index.php/ukhjss/article/view/92/130
 
Rights Copyright (c) 2019 Ebrahim Mansoori, Masood Elyasi, Rahim Mohammadi
http://creativecommons.org/licenses/by-nc-nd/4.0
 

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