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Financing constraints, major business performance, and return on financial assets

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  • Jia, Haibo
  • Zhang, Ming

Abstract

This study systematically examines the relationship between financing constraints and the return on corporate financial assets based on data from Chinese listed companies from 2012 to 2022. It found a positive correlation between the risk and return of financial asset portfolios; higher risk leads to higher return. Firms with fewer financing constraints have better returns on financial assets. A decrease in return on a firm's operating assets often coincides with an increase in return on financial assets.

Suggested Citation

  • Jia, Haibo & Zhang, Ming, 2024. "Financing constraints, major business performance, and return on financial assets," Finance Research Letters, Elsevier, vol. 66(C).
    • Handle: RePEc:eee:finlet:v:66:y:2024:i:c:s1544612324006834
    DOI: 10.1016/j.frl.2024.105653
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    References listed on IDEAS

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