Full Length Research Paper
Abstract
The aim of this paper is to study the effect of operating leverage in the systematic risk of listed companies in Tehran Stock Exchange. In this study, operating leverage (OL) as independent variable and systematic risk (β) as the dependent variable are considered. SIG ≤ 0.05 means H0 hypothesis is rejected; otherwise there is no adequate reason for rejecting H0. For testing the hypothesis of this study, linear regression technique has been used. According to the results obtained, H0 is confirmed because SIG = 0.20 > 0.05. Thus, operating leverage has no effect on the systematic risk of listed companies in Tehran Stock Exchange.
Key words: Operating leverage, capital structure, systematic risk, financial leverage, earnings before interest and taxes (EBIT).
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