Exchange Rate Exposure, Foreign Involvement and Currency Hedging of Firms - Some Swedish Evidence

Stefan Nydahl
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Stefan Nydahl: Quantal International Inc, Postal: 1936 University Avenue, Suite 355, Berkeley, CA 94704-1024, USA

No 81, Working Paper Series from Sveriges Riksbank (Central Bank of Sweden)

Abstract: This paper investigates the effect of exchange rate fluctuation on a firm’s value, the so-called exchange rate exposure, for a sample of Swedish firms. In contrast to previous results, using U.S. data, the values of Swedish firms, as reflected in the stock price, seem quite sensitive to movements in the exchange rate. Studying the cross sectional differences in exposure, the estimated exposure is positively and significantly related to the fractional of total sales made broad and negatively related to the use of currency derivatives.

Keywords: Exchange rate exposure; Foreign activities; Hedging (search for similar items in EconPapers)
JEL-codes: F30 G10 (search for similar items in EconPapers)
Pages: 35 pages
Date: 1999-05-01
New Economics Papers: this item is included in nep-ifn
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Citations: View citations in EconPapers (20)

Published in European Financial Management, 1999, pages 241-257.

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