The effects of International Accounting Standards on stock market volatility: the case of Greece

Christos Floros

Research output: Contribution to journalArticlepeer-review

Abstract

The adoption of International Accounting Standards (IAS) by the European Union (which started in 2005) is one of the biggest events in the history of financial accounting. This paper investigates the effects of adopting IAS on Greek stock market volatility. We consider daily data (covering the period 2003-2005) from four major indices of the Athens Stock Exchange (ASE): the General ASE index, FTSE/ASE-20, FTSE/ASE Mid 40 and FTSE/ASE Small Cap 80. We find that the introduction of IAS has a negative – but not significant – effect on Greek stock market volatility. This is confirmed by estimation of three different types of GARCH specifications. In addition, the unconditional variance indicates lower market volatility after the introduction of IAS in Greece for all indices. These findings are helpful to financial managers dealing with Greek stock indices.
Original languageEnglish
Pages (from-to)61-72
Number of pages12
JournalInvestment Management and Financial Innovations
Volume4
Issue number1
Publication statusPublished - 2007

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