A Proposed Framework for Measuring the Effect of Profit Management on Extraordinary Returns and Irregular Risks of Ordinary Shares"An Applied Study on the Egyptian Stock Exchange"

Document Type : Original Article

Authors

1 Accounting department Management college Modern University for Technology and Information Cairo Egypt

2 financial institutions department Management college Modern University for Technology and Information Cairo Egypt

Abstract

The study aimed to analyze the impact of profit management practices on the returns and risks of ordinary shares traded on the Egyptian Stock Exchange, through a sample of 30 individuals listed on the Egyptian Stock Exchange for the period from 2006 to 2015. This will be done using the modified Jones model to measure profit management practices by the asset pricing model. CAPM "to analyze the returns of stocks in the trading market on the other hand, with the use of the returns of the index Egypt30 - the main index of the market - to measure market returns to estimate the unusual returns and irregular risks to ordinary stocks. The results of the study concluded that there is an impact of profit management practices on irregular risks without extraordinary returns, which can be attributed to the impact of diversification on pricing of irregular risks in addition to the low efficiency of the Egyptian Stock Exchange.

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