This essay analyses alternative strategies for a firm to deal with exchange risk. “Profit maximising” and “risk minimising” strategies are examined as extreme alternatives. The former requires successful exchange rate forecasting, the latter is based on avoiding any impact of unexpected...

Purpose -Based on basic financial models and reports in the business press, exchange rate movements are generally believed to affect the value of nonfinancial firms. In contrast, the empirical research on nonfinancial firms typically produces fewer significant exposures estimates than...

Purpose – This paper investigates the motivations and practice of nonfinancial firms with regard to using options in their risk management activities. Design/methodology/approach - The paper provides a comprehensive account of the existing empirical evidence and analyzes data on the use of...

Purpose – This paper investigates the motivations and practice of nonfinancial firms with regard to using options in their risk management activities. Design/methodology/approach – The paper provides a comprehensive account of the existing empirical evidence and analyzes data on the use of...

Purpose – Based on basic financial models and reports in the business press, exchange rate movements are generally believed to affect the value of nonfinancial firms. In contrast, the empirical research on nonfinancial firms typically produces fewer significant exposures estimates than...