Determinants of the cost of equity of Malaysian firms
A number of Capital Asset Pricing Model (CAPM) and its variants are considered in this paper for exploring the determinants of the cost of equity of Malaysian firms. The semi-deviation approach is shown to yield the highest explanatory power on the returns of firms. The estimates of cost of equity f...
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| Main Authors: | , |
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| Format: | Conference or Workshop Item |
| Language: | en |
| Published: |
2010
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| Subjects: | |
| Online Access: | http://eprints.um.edu.my/11307/1/CS3-H2_Foong%26Goh.pdf http://eprints.um.edu.my/11307/ |
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| Summary: | A number of Capital Asset Pricing Model (CAPM) and its variants are considered in this paper for exploring the determinants of the cost of equity of Malaysian firms. The semi-deviation approach is shown to yield the highest explanatory power on the returns of firms. The estimates of cost of equity from the semi-deviation approach were regressed on a list of potential determinants in a panel model analysis. The results show that firm size, book-to-market ratio, payout ratio and return to equity are negatively related to the cost of equity. |
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