The purpose of this paper is to empirically investigate the interaction between hedging, financing, and investment … two decisions are being made. We argue that the way in which hedging affects the firms’ financing and investing decisions …, but not their leverage, by hedging. However, we also find that firms with few investment opportunities use derivatives to …

We examine firms' simultaneous choice of investment, debt financing and liquidity in a large sample of US corporates … sensitivities are particularly intense for unconstrained firms with high hedging needs. Investment opportunities (as proxied by Q …, constrained firms with low hedging needs are found to employ more debt to finance their investment opportunities and build up …

We exploit an exogenous change in basis risk in the oil and gas industry to analyze the channels through which hedging … investment, have lower valuations, sell assets, and reduce debt. Our findings are driven by firms with ex ante high leverage …-order channels through which hedging affects firm value …

This paper investigates the link between corporate debt and investment for a group of five peripheral euro area … countries. Using firm-level data from 2005-2014, we postulate a non-linear corporate leverage-investment relationship and derive … thresholds beyond which leverage has a negative and significant impact on investment. The investment sensitivity of debt …

Purpose: The purpose of this paper is to examine the impact of managerial optimism on corporate investment regarding … often overconfident an effort is made to highlight the effect of this psychological bias on managerial investment decision … – making. Design/methodology/approach: The research methodology is based on the approach that the investment-cash flow …

investigate this issue using a hand-collected dataset of hedging and investment behavior of oil and gas exploration and production …Extant theories suggest that managers may use hedging either to alleviate underinvestment problems caused by costly … external financing or to promote overinvestment by circumventing the scrutiny of external capital markets. We empirically …

just before the crisis reduced their investment rates 8.1 percentage points more than other publicly held firms. We also ….5 percentage points more than other exporters. These estimated reductions in investment are economically very significant …

This work compares two models of corporate hedging, to show how optimal investment, debt, and hedging strategy can be … strongly depen-dent on the mechanism linking the firm's internal funds to its return on investment. Approximated analytical … solutions for hedging are ob-tained to shed light on the di .erent empirical implications associated with the two mechanisms …

order to better coordinate investment and financing decisions. This work shows how optimal investment, debt and hedging … strategy can be strongly dependent on the mechanism linking the firm's internal funds to its returns on investment. In … particular, when internal funds react to a prospective price change (neutral shock), investment and debt would be positively …

fluctuations of its cash flow, in order to better coordinate investment and financing decisions. This work moves within this … hedging strategy, as well as the effects of hedging on firm's investing and financing behaviour. Numerical simulations of the …In a context of uncertain returns to investment, a firm may face increasing costs of borrowing and uncertain value of …