Assessment of the Level of Financial Risk Associated with the Market Activity of a Public Company, with a Neutral Approach to Its Dividend Policy

Abstract

The purpose of this article is to study the theoretical and practical aspects of assessing the level of financial risk of a public company associated with its activity on the stock market (market activity) depending on the main determining factors in the context of a neutral approach to dividend policy, by analyzing the sensitivity of key indicators of the activity of a public company on the stock market to these factors, allowing for the interests of all other stakeholders interested in the activities of the public company (including potential investors) to be taken into account in order to ensure its sustainable development, which involves approximately equal distribution of this financial risk between them, in the long term. The methodological basis of the study was the concept of a neutral approach to the dividend policy of a public company and the concept of sensitivity analysis. The motivation for the study is to ensure the development, justification and effective management of the financial risk of a public company associated with its market activity depending on the main determining factors in the context of a neutral approach to dividend policy, to ensure the interests of its main stakeholders by constructing elasticity models of key indicators of market activity by the main determining factors, allowing to assess the level of financial risk associated with these factors. The author concludes that the elasticity models of key indicators of a public company's activity on the stock market by the main determining factors developed by him are a fairly effective tool for assessing the level of financial risk caused by the degree of market activity of a public company under conditions of a neutral approach to the implementation of its dividend policy. JEL codes: C15, G32, G34, G35 MSC codes: 91G50, 91G70, 91G80