Diversification Strategy, Accounting Determined Risk, and Accounting Determined Return

1 June 1982

journal article
Published by Academy of Management in The Academy of Management Journal

Vol. 25 (2) , 254-264
https://doi.org/10.5465/255989

Abstract

Risk and return are studied in a sample of related and unrelated (conglomerate) diversified firms. The primary findings are that unrelated firms do not enjoy superior risk-pooling characteristics and that the superior returns attributed by Rumelt (1974, 1977) to related diversification may be due largely to industry effects.

Keywords

RISK MANAGEMENT IN BUSINESS
CONGLOMERATE CORPORATIONS
RATE OF RETURN
STRATEGIC PLANNING
DIVERSIFICATION IN INDUSTRY
CONSOLIDATION & MERGER OF CORPORATIONS
DIVERSIFIED COMPANIES
BUSINESS PLANNING
ORGANIZATIONAL STRUCTURE
FINANCIAL PERFORMANCE

This publication has 2 references indexed in Scilit:

The Strategy and structure of top 100 Japanese industrial enterprises 1950–1970
Strategic Management Journal, 1980
Capital Markets: Theory and Evidence
The Bell Journal of Economics and Management Science, 1972