"Previous studies have found mixed evidence on whether hedging increases firm value. Some studies have shown that managerial incentives may influence firm hedging. In this paper we provide evidence that when hedging is based upon incentives from managers' options, firm value decreases."...

Some studies have provided evidence that hedging increases firm value. Other studies have shown that managerial incentives may influence firm hedging. In this paper we provide evidence that hedging increases firm value, however, when hedging is based upon incentives caused by managers' options,...