Seize the moment: Opportunism in Australian capital markets

This paper examines theories of capital structure using a dataset of listed Australian companies from 1993 to 2005. Companies appear to have target leverage but they take advantage of favorable firm characteristics to achieve these targets. Issuers issue debt when they are profitable. When firms are...

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Bibliographic Details
Published in:Pacific-Basin finance journal 2011-09, Vol.19 (4), p.374-389
Main Authors: Koh, SzeKee, Durand, Robert B., Watson, Iain
Format: Article
Language:English
Subjects:
Capital structure
Capital structure Opportunistic behavior Dynamic leverage behavior
Dynamic leverage behavior
Opportunistic behavior
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Summary:This paper examines theories of capital structure using a dataset of listed Australian companies from 1993 to 2005. Companies appear to have target leverage but they take advantage of favorable firm characteristics to achieve these targets. Issuers issue debt when they are profitable. When firms are profitable and perform well in the market, they will issue both debt and equity.
ISSN:0927-538X
1879-0585
DOI:10.1016/j.pacfin.2011.01.003