Methodology of identification optimal capital structure
Analysis of existing models for identifying the optimal debt structure. Identify and analyze the factors and risks that can determine and mitigate the capital structure. Development of a debt management model for optimizing the capital structure.
| Рубрика | Финансы, деньги и налоги |
| Вид | магистерская работа |
| Язык | английский |
| Дата добавления | 18.11.2017 |
| Размер файла | 1,7 M |
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As a basis model, were chosen the model developed by Hayne Leland. However, in order to apply this model to the task of identifying the optimal capital structure for the companies some modifications were made. As it was already stated, the model invented by Hayne Leland was chosen, on the one hand due to its' positive sides, and close to reality approach, and in the other hand, because of its simplicity.
The research goal can was stated as developing the optimal debt structure identification model. This goal was achieved by achieving all the thesis objectives. After the creation of the model the algorithm of its' implementation to the real companies were designed. Finally, the model was tested on the real companies under different market conditions. And practical recommendations to those companies were given.
Application of the proposed model showed some difference in the calculated level of leverage and observed one. For the most of cases, the calculated level of leverage exceeds the observed level of leverage. This debt value overvaluation was already mentioned in this type of models by the previous researches. However, the recommendations to solve this problem were given in the research.
All in all, the model developed in this master thesis, from a theoretical point of view uses more accurate analysis of the company capital structure, then commonly used models - like modifications of Hamada's equation. Also, this master thesis has contributes the scientific society, due to implementation of the model based on the “option-like” approach to equity with defining the “narrow places” of this approach, and designing the algorithm of implementing similar type of models to the real cases, which opens huge possibilities for further studies on the same topic. From the practical point of view, as it was described previously, since the capital structure is such an important side of the firms performance, the model that describes the main patterns of the firms leverage and recommends the optimal structure of it, has a huge variety of managerial implications and is interesting for the different stake holders of the company. However, it can be said that the model needs further development in a way that it was recommended, in order to gain more accurate results.
List of references
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