Impact of Financial Leverage, Firm Performance on Systemetic Risks in Developing Countries: An Analysis on Vietnamese Listed Firm

Abstract

In this paper, we study the link between financial leverage, firm performance on the systemetic risks in developing countries, especially in the case of a developing country in Asia like Vietnam. Although there are many papers on this topic, the difference between them and this paper is that we have conducted the study in Vietnam that have not yet been studied together. The data used were collected from Ho Chi Minh City Stock Exchange (HOSE) and Hanoi Stock Exchange (HNX) in the period of 2013 – 2018. Based on the results of the panel data regression, the study can demonstrate that a firm used more current assets can positively impact on systemetic risk. Furthermore, a firm owned more performance can certainly decrease systemetic risk. Regarding firm size, and financial leverage, the results demonstrate that firm size, and financial leverage are insignificantly correlated with systematic risk.