The Risk Level of Viet Nam Software Industry Under Financial Leverage During and After the Global Crisis 2009-2011

Abstract

After the financial crisis 2007-2009, this research paper evaluates the impacts of external financing on market risk for the listed firms in the Viet nam software industry. First, by using quantitative and analytical methods to estimate asset and equity beta of total 6 listed companies in Viet Nam software industry with a proper traditional model, we found out that the beta values, in general, for many institutions are acceptable. Second, under 3 different scenarios of changing leverage (in 2011 financial reports, 30% up and 20% down), we recognized that the risk level, measured by equity and asset beta mean, decreases when leverage increases to 30% and it increases if leverage decreases down to 20%. Third, by changing leverage in 3 scenarios, we recognized the dispersion of risk level, measured by equity and asset beta var, increases slightly if the leverage increases to 30%. Finally, this paper provides some outcomes that could provide companies and government more evidence in establishing their policies in governance.