u/Unusual_Tennis_3047

I’m in my master thesis i am regressing “total debt” on “first day return”. To disregard size effects of firms i want to standardize total debt by dividing eith market cap (i dont have total assets). I’m not sure if this gives endogenity problems because market cap is defined as total shares x offer price and offer price is used to determine the first day return as well.
Can anyone help with this?

I’m in my master thesis i am regressing “total debt” on “first day return”. To disregard size effects of firms i want to standardize total debt by dividing eith market cap (i dont have total assets). I’m not sure if this gives endogenity problems because market cap is defined as total shares x offer price and offer price is used to determine the first day return as well.
Can anyone help with this?