An examination of the capital structure and synchronization of stock returns

Abstract EN

The paper examines the signaling effect of corporate financing for the non-financial firm that are listed in Egypt stock exchange.

the data cover the years 2000 to 2020 annually.

the signaling effect uses the synchronization of stock returns.

the analysis of this paper examines the current corporate financial strategies that affect synchronization of stock returns model 1 shows that for debt levels and capacity or leverage ratios, the results indicate that only long-term debt to total assets is found statistically significant and negative with synchronization of stock returns.

moreover, for model 2, the analysis shows that firm size has great effect on the synchronization of stock returns.

the firms’ size is examined through dummy variables using the natural log of total assets.

the results indicate that corporate size has significant and positive effects on stock return synchronization.

as for the effects of types of industries (model 3), the results show that the types of industries have no effect on the synchronization of stock returns, since one industry (broadcasting) out of 39 industries is statistically significant and negative with the synchronization of stock returns and the others 38 industries are not significant.