The association between firm characteristics and the use of a comprehensive corporate hedging strategy: An ordered probit analysis

Yong, Hue Hwa Au, Faff, Robert and Nguyen, Hoa (2011) The association between firm characteristics and the use of a comprehensive corporate hedging strategy: An ordered probit analysis. Frontiers in Finance and Economics, 8 1: 1-16.

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Name Description MIMEType Size Downloads
Author Yong, Hue Hwa Au
Faff, Robert
Nguyen, Hoa
Title The association between firm characteristics and the use of a comprehensive corporate hedging strategy: An ordered probit analysis
Journal name Frontiers in Finance and Economics   Check publisher's open access policy
ISSN 1814-2044
Publication date 2011-04-01
Sub-type Article (original research)
Volume 8
Issue 1
Start page 1
End page 16
Total pages 16
Place of publication Lille, France
Publisher E S C Lille
Collection year 2012
Language eng
Abstract We investigate the potential factors that influence the corporate decision to collectively use foreign currency; interest rate; and commodity derivatives and foreign debt. Our Australian results show that firm size ('scale economies' hypothesis); leverage ('financial distress cost' hypothesis); and block holdings are positively associated with the comprehensive hedging decision, while executive shareholdings has a negative association. However, we do not find any support for the underinvestrnent or managerial risk aversion hypotheses.
Keyword Derivative use
Coordinated corporate hedging strategy
Ordered prohibit analysis
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2012 Collection
UQ Business School Publications
 
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Created: Tue, 18 Oct 2011, 18:32:49 EST by Karen Morgan on behalf of UQ Business School