sensitivities are particularly intense for unconstrained firms with high hedging needs. Investment opportunities (as proxied by Q …), however, play a larger role for constrained firms with the effects being strongest in case of low hedging needs. Interestingly …, constrained firms with low hedging needs are found to employ more debt to finance their investment opportunities and build up …

We study the implications of financial hedging for corporate cash policy. Using a web crawler program to collect data … on the use of financial derivatives, we find that firms with financial hedging programs have smaller cash reserves but a … higher value of cash than firms without hedging contracts in place. Our empirical results are robust when controlling for …