The companies financial architecture and the market values: is there an interlinkage ? The case of Bucharest Stock Exchange

Pirtea, Marilen and Dima, Bogdan and Milos, Laura Raisa (2009): The companies financial architecture and the market values: is there an interlinkage ? The case of Bucharest Stock Exchange.

Abstract

Nowadays there is a large debate on whether the financial information proves any relevance for the investors´ prediction of the securities market values/stock prices. The paper focuses, besides reviewing some important literature concerning this issue, on an empirical analysis taking into consideration 44 companies listed on Bucharest Stock Exchange based on pool data linear regressions. It is true that the most recent research state that there is an important evidence of a deterioration of the relationship between accounting information and stock prices. Although, the main findings of this paper consist in that there are certain aspects which should be further examined for a more reliable conceptual approach. In addition, it concludes that - even in the case of an emergent capital market as Bucharest Stock Exchange - it can be found mixed evidences to support the importance of financial information in portfolio’ management decisions. In a sense or another, the paper state overall that the financial information matter for market determination of financial assets’ values.

• Item Type: MPRA Paper
• Language: English
• Keywords: capital markets, financial information, financial assets’ valuation
• Subjects: C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C32 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes ; State Space Models; G - Financial Economics > G1 - General Financial Markets > G14 - Information and Market Efficiency ; Event Studies ; Insider Trading; D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information ; Mechanism Design

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