reasons why hedging should lead to enhanced shareholder value, but empirical evidence in support of a substantial value … increase from hedging is, at best, mixed. In this paper, we synthesize the empirical evidence for value enhancement in firms …' hedging with derivatives using a statistical meta-analysis combining data from 47 different studies. Our findings indicate …

A closed-form solution is obtained for the discrete-time global quadratic hedging problem of Schweizer (1995) applied …

Recent research has shown that global quadratic hedging, also known as variance-optimal hedging and mean …-variance hedging, can significantly reduce the risk of hedging call and put options with long-term maturities (one year or more), such … as Long-Term Equity AnticiPation Securities (LEAPS). We propose a modification to global quadratic hedging that is more …

By means of a difference-in-differences approach (sigma-DID), we investigate the effect that hedging has on corporate … risk. Examining the relation between hedging and the idiosyncratic variance of stock returns, we show that when new …

light on this central question in corporate hedging theory. We use hand-collected data from the oil and gas industry that …-based theories of risk management. We document a broad absolute decrease in the use of hedging and a significant relative decrease in … hedging in financially constrained firms …

I incorporate the choice of hedging instrument into a moral hazard model to study the impact of derivatives on a firm …'s value. A hedging instrument creates value by minimizing the expected costs of distress. In the model, managers who exert … as a hedge. I show that the optimal hedging instrument maximizes the firm's value but does not reduce the noise in the …

, derivatives hedging and operating flexibility, in the presence of several frictions. We show that liquidity serves a critical and … hedging is likely to be low, though we explain why some empirical studies find a higher value. We explore the complex … are affected by operating leverage, the nature of operating flexibility, and the effectiveness of the hedging instrument …

derivatives for hedging activities. Based on a sample of 300 Malaysian listed companies, we found that only 162 companies (54 …

This study investigates the effect of corporate hedging on stock price crash risk. We test two competing hypotheses …. Under the transparency hypothesis, hedging reduces a firm's information asymmetry and lowers crash risk. Under the opacity … hypothesis, hedging decreases financial reporting quality and increases crash risk. Using a comprehensive sample of firms from …