Earning response coefficient: the Indonesia stock exchange case / Ambarwati and Eka Sudarmaji

• Main Authors: -, Ambarwati,, Sudarmaji, Eka
• Other Authors: Md Kassim, Fazdilah
• Format: Book Section
• Language: English
• Published: UiTM Cawangan Johor 2019
• Subjects: Stock exchanges. Insider trading in securities
• Online Access: http://ir.uitm.edu.my/id/eprint/38676/1/38676.pdf; http://ir.uitm.edu.my/id/eprint/38676/

This research examines the effect of profitability, systematic risk, leverage and earnings persistence on Earnings Response Coefficient (ERC) in companies listed in LQ45 at Indonesia Stock Exchange (IDX). The objects of this research are companies that are consistently listed in LQ45 in the year of 2015-2017. This study uses panel data regression analysis using the software, Eviews. The empirical results of this research showed that systematic risk and earnings persistence has a significantly negative effect on ERC, leverage has a significantly positive effect on ERC, while profitability does not have an effect on ERC. The results of the research show that the factors of systematic risk, leverage and earnings persistence owned by the company have an effect on investment decisions made by investors.