Determinant of Corporate Cash Holding: Evidence From LQ45 Index Companies on Indonesia Stock Exchange

Abstract

This study aims to examine the effect of institutional ownership, profitability and firm size on the cash holding of the LQ45 Index Companies on the Indonesia Stock Exchange. The population of this study is the company of LQ 45 Index on the IDX for the period 2015-2017. A total of 210 companies were determined target populations based on certain criteria. This study uses a regression method for panel data, namely by looking at random effects based on the Hausman test results. The results show that institutional ownership, profitability and firm size have a positive effect on cash holding. The findings are useful for managers, shareholders, investors, regulators and researchers in developing suitable policies Keyword : Study, Profitability, Institutional Ownership.