Nexus between financial hedging, performance, and firm value: Evidence from a sample of non-financial Asia-Pacific firms
Publication Type
Conference Paper


Use of hedging and firm value (and performance) nexus has received mixed attention due to conflicting results that broadly consider firms from the U.S. and European contexts. This study investigates data from Asia-Pacific region to observe the interaction between use of hedging, value, and performance of non-financial firms. Results indicate hedging to be value enhancing irrespective of the three types of risks hedged: foreign currency, interest rate, and commodity price risk, having foreign currency ris as the strongest driver. This nexus, however, is weaker for commodity price risk. Several moderation and robustness tests also confirm that profitable, highly levered, and high growth companies use derivatives for hedging to a larger extent. We forward that both reactive and proactive approaches to hedging can be explained with respect to corporate intention to reduce “reputation risk”.

Conference Title
The 6th Vietnam Symposium in Banking and Finance (VSBF2021), Hanoi, Vietnam
Conference Country
Conference Date
Oct. 28, 2021 - Oct. 30, 2021
Conference Sponsor
jointly organized by the Association of Vietnamese Scientists and Experts (AVSE Global), the Banking Academy of Vietnam, and the International Society for the Advancement of Financial Economics (ISAFE) in partnership with the IPAG Business School
Additional Info
Conference Website