THE IMPACT OF OVERSEAS OPERATIONS ON THE U.S. MARKET RISK OF MULTINATIONAL COMPANIES

Global Business and Finance Review

Suneel Maheshwari¹  Ramchandra Akkihal¹  Anand Krishnamoorthy² 

[1] Marshall University, Huntington, West Virginia, USA;Troy State University - Pacific Region;

关键词: multiational companies;    market risk;    systematic equity;    international diversification;   

DOI  :  

来源: DOAJ

【 摘 要 】

The study examines the impact o f a multinational firms foreign operations on its systematic equity risk (beta) . Beta is computed for a sample o f multinational firms using the market model regression and is then regressed on the firms foreign sales characteristics. The results indicate that a firm s foreign operations positively relate to its systematic equity risk in terms ofboth total and regionalforeign sales. This is contrary to international portfolio diversification theories, which state that investing in multinational firms reduce an investors exposure to movements in the US market. This paper demonstrate that investors do not view multinationalfirms as vehicles for international diversification.

【 授权许可】

Unknown