Title: Hybrid Financing Instruments and Capital Structure Optimization
Authors: Eserinune Ejakpogba Ortega, Professor Ehiedu Victor C.
Volume: 9
Issue: 5
Pages: 53-59
Publication Date: 2025/05/28
Abstract:
: This article investigates the role of hybrid financing instruments in the optimization of capital structure among corporate entities. Hybrid instruments, which blend the characteristics of debt and equity, have gained popularity as firms strive to maintain financial flexibility while optimizing their cost of capital. Using data from 250 publicly listed firms across diverse sectors between 2013 and 2023, the study employs panel regression analysis to assess the impact of hybrid financing on capital structure indicators such as weighted average cost of capital (WACC), return on assets (ROA), and firm value (Tobin's Q). The findings reveal that hybrid financing significantly enhances capital structure optimization, especially in firms facing high volatility or regulatory constraints.