Finance and Financial Management Commons^™

Usage Of Derivatives In Business Today, Duston J. Hodgkins

Honors Scholar Theses

Derivatives were created as a method of hedging risks. Yet in today's society, derivatives have taken on many new roles, and with it have systemically changed the way the financial industry operates. Warren Buffett called these powerful tools "financial weapons of mass destruction." No longer do these tools simply mitigate risks; instead, they are creating new and potentially lethal risks. How did their usage shift from risk management? This thesis delves into what actions occurred over the past half century that drove derivatives usage to what is facing the market today. Through the exploration of major successes and failures of …

Essays On Earnings Quality: Evidence From Net Share Issue, Put Option Sales, And Hedging, Jagadish Dandu

Open Access Theses & Dissertations

There are three essays in this research. The main objective of the research is to extend the literature in corporate finance by investigating the quality of earnings around corporate events like net share issues, put option sales by firms on their own stock, and hedging commodities by high input cost group of firms.

The first paper is "Does Earnings Quality predicts Net Share Issuance". This paper investigates whether quality of earnings predicts net share issuance by corporations. Pontiff and Woodgate (2008) show that annual share issuance (ISSUE) measure is a better predictor of future cross-sectional returns and we use this …