The present study endeavors to empirically examine the relationship between non-systematic risk and the quality of smoothed profits according to the comparative approach of high-quality profit companies and low-quality profit companies in the Tehran Stock Exchange Market.
The most important point in the present study is to investigate the kind of relationship between smooth profits and non-systematic risk.
Is there a significant relationship between non-systematic risk and smoothed profit?
H1: There is a significant relationship between high quality smoothed profits and the company's non-systematic risk.
The dependent variable is non-systematic risk that is a risk caused by company's specific features such as type of product, capital structure of the main shareholders, etc.
As shown in table 1, the correlation coefficient between non-systematic risk variable and high quality smoothing companies variable is -0.
Prediction level of non-systematic risk according to model is shown in figure 1.
Second, entrepreneurial individuals and firms may consciously choose to seek out states or regions with above average non-systematic risk.
A state, for example, may be selected as a location because of its tendency to grow at above systematic risk-adjusted rates due to non-systematic risk characteristics.
Large non-systematic risk found in the return of paintings also suggested that collectors should diversify to other assets.
The activities of art speculators also exaggerate the return volatility of paintings and a large non-systematic risk suggests collectors should diversify their wealth to other assets.