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he global crisis 2007-2009 has some certain impacts on the whole Viet nam economy, and specifically, the Viet Nam construction industry. However, together with financial system development and the economic growth, throughout many recent years, Viet Nam construction industry is considered as one of active economic sectors, which has some positive effects for the economy. Hence, this research paper analyzes market risk under a two factor model of these listed construction firms during this period.

This paper is organized as follow. The research issues and literature review will be covered in next sessions 2 and 3, for a short summary. Then, methodology and conceptual theories are introduced in session 4 and 5. Session 6 describes the data in empirical analysis. Session 7 presents empirical results and findings. Next, session 8 covers the analytical results. Then, session 9 presents analysis of risk. Lastly, session 10 will conclude with some policy suggestions. This paper also supports readers with references, exhibits and relevant web sources.

For the estimating of impacts of a two factor model: external financing and the size of competitor on beta for listed construction industry companies in Viet Nam stock exchange, research issues will be mentioned as following: Issue 1 : Whether the risk level of construction industry firms under the different changing scenarios of leverage and the size of competitor increase or decrease so much.

Issue 2 : Whether the disperse distribution of beta values become large in the different changing scenarios of leverage and the size of competitor estimated in the construction industry. Kinnon (1973) and Shaw (1973) pointed a large and active theoretical and empirical literature has related dfinancial development to the economic growth process. Black (1976) proposes the leverage effect to explain the negative correlation between equity returns and return volatilities. Diamond and Dybvig (1983) said banks can also help reduce liquidity risk and therefore enable long-term investment. Aghion et all (1999) stated debt instruments can reduce the amount of free cash available to firms and thus managerial slack.

Peter and Liuren (2007) mentions equity volatility increases proportionally with the level of financial leverage, the variation of which is dictated by managerial decisions on a company's capital structure based on economic conditions. And for a company with a fixed amount of debt, its financial leverage increases when the market price of its stock declines.

Reinhart and Rogoff (2009) pointed the history of finance is full of boom-and-bust cycles, bank failures, and systemic bank and currency crises. Adrian and Shin (2010) stated a company can also proactively vary its financial leverage based on variations on market conditions. arginal rates in corporate and top personal income declined has stopped.

Last but not least, Ana and John (2013) Binomial Leverage -Volatility theorem provides a precise link between leverage and volatility. Chen et all (2013) supports suspicions that over-reliance on shortterm funding and insufficient collateral compounded the effects of dangerously high leverage and resulted in undercapitalization and excessive risk exposure for Lehman Brothers.

In a specific industry such as construction industry, on the one hand, using leverage with a decrease or increase in certain periods could affect tax obligations, revenues, profit after tax and technology innovation and compensation and jobs of the industry. Next, in a competitive market, there raises an issue of choosing a competitive firm as a competitor. There are many firms offering the similar products and services and this helps customers select a variety of qualified goods that meet their demand. Competitors could affect price and customer service policies; hence, affect revenues and profits of a typical company. So, a company needs a risk management policy to reduce risks coming from competitors, both current and potential.

In this research, analytical research method is used, philosophical method is used and specially, scenario analysis method is used. Analytical data is from the situation of listed construction industry firms in VN stock exchange and applied current tax rate is 25%. Finally, we use the results to suggest policy for both these enterprises, relevant organizations and government.

The research sample has total 104 listed firms in the construction industry market with the live data from the stock exchange.

Firstly, we estimate equity beta values of these firms and use financial leverage to estimate asset beta values of them. Secondly, we change the leverage from what reported in F.S 2011 to increasing 30% and reducing 20% to see the sensitivity of beta values. We found out that in 3 cases, asset beta mean values are estimated at 0,471, 0,389 and 0,539 which are negatively correlated with the leverage. Also in 3 scenarios, we find out equity beta mean values (0,602, 0,512 and 0,664) are also negatively correlated with the leverage. Leverage degree changes definitely has certain effects on asset and equity beta values.

In the below section, data used are from total 104 listed construction industry companies on VN stock exchange (HOSE and HNX mainly). In the scenario 1, current financial leverage degree is kept as in the 2011 financial statements which is used to calculate market risk (beta) whereas competitor size is kept as current, then changed from double size to slightly smaller size. Then, two (2) FL scenarios are changed up to 30% and down to 20%, compared to the current FL degree. In short, the below table 1 shows three scenarios used for analyzing the risk level of these listed firms.

Market risk (beta) under the impact of tax rate, includes: 1) equity beta; and 2) asset beta. All three above tables and data show that values of equity and asset beta in the case of increasing leverage up to 30% or decreasing leverage degree down to 20% have certain fluctuation. ? Based on the calculated results, we find out First of all, Equity beta mean values in all 3 scenarios are acceptable (< 1,1) and asset beta mean values are also small (< 0,4). In the case of reported leverage in 2011, equity and asset beta min values increase when the competitor size changed from current to slightly smaller and to double size (0,077 and 0,008). If leverage increases to 30%, equity and asset beta min values are the highest when competitor size kept as current (-0,366 and -0,031). Finally, when leverage decreases down to 20%, equity and asset beta min values reach maximum values in case compmetitor size doubles (0,156 and 0,023).

When leverage degree decreases down to 20%, average equity beta values increase slightly (1,046 and 1,041) compared to those at the initial reported leverage (0,944). Then, when leverage degree increases up to 30%, average equity beta decreases little more (to 0,934 and 0,947). However, in case the competitor size doubles, the risk level of the selected firm is higher. Next, the fluctuation of equity beta value (0,150) in the case of 30% leverage up is higher than (>) the results in the rest 2 leverage cases. And we could note that in the case competitor size doubles, the risk is more dispersed. Last but not least, from chart 2, under financial leverage, in case competitor size doubles, asset beta mean (0,312) is lower than the rest 2 cases whereas the risk dispersion is almost the same (0,069).