Asymmetric information models predict a “pecking order” which reflects a combination of owner-manager preferences and external capital supply constraints whenever insiders know more about the true value of the firm’s prospects than outsiders. The pecking order results in retained earnings being the most preferred source of finance, then debt and finally the issue of new shares to outsiders. Usi...

Free radicals are species with one or more unpaired electrons. The unpaired electron results in a species that is often highly reactive. Free radicals have a wide range of reactions; two broad classes of reactions are electron transfer and addition reactions resulting in covalent bond formation. Free radicals can be classified as reducing (donating an electron to an acceptor) or oxidizing (acce...

We study the financing patterns of large and indivisible projects – arguably the main focus of capital structure theory – by developing a filter that identifies investment spikes in a large population of firms. Consistent with the pecking-order theory we find that projects are predominantly financed with debt, particularly in large and profitable firms. However, we reject the hypothesis that in...

The aim of this empirical study is to explore the trade-off model and pecking order model of capital structure. The investigation is performed using panel data procedures for a sample of 76 firms listed in Tehran Stock Exchange during 2007-2010.The study employs OLS regression model in examining the capital structure of firms in Iran. The study employs variables reflecting differing theoretical...

We report results of a new test of the financing of large and indivisible projects – arguably the focus of most capital structure theory. We develop a filter that identifies investment spikes in a large population of firms. Consistent with the pecking-order theory we find that projects are predominantly financed with debt, particularly in large and profitable firms. However, we reject the hypot...

Convertible bonds (CBs) are an important asset class but their analysis in function of the equity and bond components has received insufficient attention in France. This study investigates the relation between announcement effects and equity components for 141 French CB issues. We use the CB sensitivity to its underlying common stock as a proxy for the equity component. Our results indicate tha...