Assymetric information associated with issues of transparency, governance and the country's financial, economic and political organization make it difficult to price bonds issued by sovereign entities. Where asymmetric information and corporate debt are concerned, the literature suggests that...

Besides market risk, stock market investments in emerging markets are also exposed to political phenomena that are not generally present in the more developed economies. This problem is well known to banks and multinational companies as country or political risk. Assessment techniques in these...

In this paper we look at the determinants of Indian eurobond prices over the period 1990-1992. We measure the general market effect of changes in the risk-free term structure and test for the effect of idiosyncratic factors such as ratings, listing exchange, issuer type, lead manager, number of...

This paper studies the determinants and the value effects of corporate hedging for 227 Hong Kong and Chinese companies listed on the Hong Kong stock exchange. Using data from disclosures in the annual reports, we find strong evidence linking the decision to hedge and the expected costs of...

We use the performance of Indian Eurobonds over the period 1990-1992 to examine the sensitivity of India's creditworthiness to the Iraqi invasion of Kuwait on August 2, 1990. We also explore the related question of whether the changes in creditworthiness, measured as the effect of changes in...

In this paper we use UK data to present strong empirical evidence that explains the mixed results in previous studies with respect to the effect of financial distress on the demand for corporate hedging. We build on recent studies that have identified a strong link between foreign currency (FC)...

In this paper we use survey data and data from annual reports to identify the determinants of hedging activity of United Kingdom (UK) firms in the context of an overall program of risk management. Comparing the two sets of data makes it possible to identify misclassified firms, that is, firms...

In the United Kingdom Financial Reporting Standard (FRS) 13, which came into force for March 1999 year-ends, requires narrative and numerical disclosure of all financial instruments held or issued, in order to provide information about their impact on the firm's risk profile. We use this...

In this paper we look at capital budgeting techniques when the abandonment value is stochastic. We investigate how these techniques can be exploited as management tools to aid not only in the invest/abandon decision but also in ongoing project management, financial forecasting and the timing of...

This paper measures how the risk associated with foreign direct investment in the prosperous, liberal economies of Hong Kong and Taiwan is affected by the prospect of reunification with the poor, politically and economically backward mainland. This China factor is modeled as a jump to a higher...