THE CORELLATION RISK – RETURN ON EMERGENT MARKETS: THE ROMANIAN CASE

Risk is an important factor in explaining capital structure choices of companies. This paper proposes a framework where we realized a study case: in this study we test if return on assets and return on equity has influence on the risk, both on long and short term. For this purposes, we conduct an empirical research that covers 33 selected companies traded at the Bucharest Stock Exchange within the time period 2005-2009. For the study our results reveal that dynamic global risk can be associated to a low intensity with total assets performance of the company’s. Investments efficiency and the adoption of certain financial positions appear to be key factors in the dynamics of, while total asset performance is weak associated with the dynamics of global risk.