THE IMPACT OF FINANCIAL RATIOS ON STOCK PRICE VOLATILITY: A QUANTITATIVE ANALYSIS OF LISTED COMPANIES

Authors

  • Muhammad Al Faridho Awwal DMS, Kazian School of Management, India

Keywords:

Financial Ratios, Stock Price Volatility, Current Ratio, ROE, DER, Panel Regression

Abstract

Abstract

This study aims to analyze the influence of financial ratios on stock price volatility in companies listed on the Indonesia Stock Exchange. The financial ratios analyzed include liquidity ratios (Current Ratio, Quick Ratio), profitability (Return on Assets, Return on Equity), and leverage (Debt to Equity Ratio). The research method used is a quantitative approach with panel regression analysis techniques on secondary data taken from annual financial statements and historical stock prices over a certain period. The research results indicate that liquidity and profitability ratios have a negative impact on stock price volatility, while the leverage ratio has a positive and significant effect. These findings indicate that the internal financial conditions of the company play a crucial role in shaping market risk perceptions and influencing stock price fluctuations. This research provides implications for investors, company management, and academics in understanding the role of financial indicators in the dynamics of the capital market.

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Published

2025-01-30

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Vol. 3 No. 1 (2025): January

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