One of the elements of company’s evaluation is ratio analysis. It includes computation of bankruptcy risk metrics … indebtedness ratio. In this study, the accuracy of bankruptcy predictions based on these two ratios is evaluated within a sample of …

We examine the puzzling negative relation between financial distress risk and the cross-section of expected returns. We … most recent distress risk shocks to which investors initially underreact, causing temporary overpricing of distressed … stocks. In the long run, the relation between distress risk and returns reflects the positive risk premium as distress risk …

We construct a theoretical framework to investigate the impact of liquidity risk, in the secondary corporate debt … market, on corporate risk-taking preferences. Using closed-form solutions, our model shows that equity holders choose to … adopt high-risk projects upon the arrival of illiquidity shocks. This effect is more pronounced for firms with weaker …

on insolvency risk will be defined by recalling the concepts of Cash Flow-at-Risk and Capital-at-Risk. A first check on … through a simulation model. The scenario analysis allows us to examine how financial and risk policies oriented by insolvency …This conceptual paper focuses on the relationship between insolvency, capital structure, and value creation. The aim is …