Factors affecting the level of cash holding of companies listed in Vietnam stock market
Abstract
Understanding factors affecting the level of cash holding is and has been a challenging
task in finance to reach business objectives. That is the reason why cash management is as much
an integral part of business cycle in any period. Statistical and econometrical models are broadly
used in analysis of specific factors affecting. This paper investigates the factors affecting the
level of cash holding with the combined application of descriptive statistics, univariate analysis
and regression methods such as model Fama–MacBeth, regression using cross-sectional data of
average value, pooled OLS regression with year dummies, pooled OLS regression with year
dummies and industry dummies. This paper also outlines the practical steps which need to be
undertaken to use above methods on companies listed in Vietnam stock market. A framework for
each methodology is drawn up. The emphasis is on analysis trend of factors affecting the level of
cash holding when being put in consideration and explanation with related theories. The main
goal of this study is to present the result of each method and factors affecting the level of cash
holding in order to bring general insights of Vietnam stock market to help individual investors
make decisions.
Keywords: Vietnam stock market, descriptive, univariate, regression, level of cash
holding.