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Full-Text Articles in Finance and Financial Management
Hedging Season: The Effect Of Hedging Using Financial Derivatives On Firm Value Of Publicly-Listed Non-Financial Firms In The Philippines, Julio Alfonso D. Arrastia, Christina Angela N. Balagot, Joseph Anthony Go, Dominique Ann Philomena V. Lacuna
Hedging Season: The Effect Of Hedging Using Financial Derivatives On Firm Value Of Publicly-Listed Non-Financial Firms In The Philippines, Julio Alfonso D. Arrastia, Christina Angela N. Balagot, Joseph Anthony Go, Dominique Ann Philomena V. Lacuna
Angelo King Institute for Economic and Business Studies (AKI)
Firms use financial derivatives as a way to hedge risky transactions to avoid financial risks. Studies have focused on firms’ use of financial derivatives in developed countries. However, there is limited research done on emerging markets like the Philippines because these economies have only recently adapted advanced reporting standards that obligate the disclosure of the nature and extent of risks resulting from the use of financial instruments. We used Tobin’s Q ratio to proxy for firm value and to determine the presence of a hedging premium. Because derivatives are used by firms to hedge against currency risks, interest rate risks, …
Hedging And Pricing Rent Risk With Search Frictions, Briana Chang, Hyunsoo Choi, Harrison Hong, Jeffrey Kubik
Hedging And Pricing Rent Risk With Search Frictions, Briana Chang, Hyunsoo Choi, Harrison Hong, Jeffrey Kubik
Research Collection Lee Kong Chian School Of Business
The desire of risk-averse households to hedge rent risk is thought to increase home ownership and prices. While evidence for the ownership implication is compelling, support for the price effect is mixed. We show that an important reason is search frictions. Rent risk reduces outside options, leading to less-picky buyers and worse home/buyer matches. This attenuates the rise in the price-to-rent ratio that would otherwise occur without frictions. Consistent with our model, a house remains on the market for fewer days when rent risk is higher. Accounting for frictions significantly increases the effect of rent risk on home prices.
Hedging And Pricing Rent Risk With Search Frictions, Briana Chang, Hyunsoo Choi, Harrison Hong, Jeffrey Kubik
Hedging And Pricing Rent Risk With Search Frictions, Briana Chang, Hyunsoo Choi, Harrison Hong, Jeffrey Kubik
Research Collection Lee Kong Chian School Of Business
The desire of risk-averse households to hedge rent risk is thought to increase home ownership and prices. While evidence for the ownership implication is compelling, support for the price effect is mixed. We show that an important reason is search frictions. Rent risk reduces outside options, leading to less-picky buyers and worse home/buyer matches. This attenuates the rise in the price-to-rent ratio that would otherwise occur without frictions. Consistent with our model, a house remains on the market for fewer days when rent risk is higher. Accounting for frictions significantly increases the effect of rent risk on home prices.
Short Selling Meets Hedge Fund 13f: An Anatomy Of Informed Demand, Yawen Jiao, Massimo Massa, Hong Zhang
Short Selling Meets Hedge Fund 13f: An Anatomy Of Informed Demand, Yawen Jiao, Massimo Massa, Hong Zhang
Research Collection Lee Kong Chian School Of Business
The existing literature treats the short side (i.e., short selling) and the long side of hedge fund trading (i.e., fund holdings) independently. The two sides, however, complement each other: opposite changes in the two are likely to be driven by information, whereas simultaneous increases (decreases) of the two may be motivated by hedging (unwinding) considerations. We use this intuition to identify informed demand and document that it exhibits highly significant predictive power over returns (approximately 10% per year). We also find that informed demand forecasts future firm fundamentals, suggesting that hedge funds play an important role in information discovery. (C) …