Colorado College Working Paper No. 2011-02
11 Pages Posted: 13 Jun 2011
Date Written: June 13, 2011
The following article tests the wealth-building nature of derivatives usage in non-financial firms. Investigating 434 firms and employing univariate and multivariate tests, it uses both the fair values and notional values of firms’ derivatives contracts to determine whether derivatives usage enhances or destroys firm value.
Keywords: Derivatives, risk management, stockholder wealth, agency theory
JEL Classification: G1
Suggested Citation: Suggested Citation
Naito, Jack and Laux, Judith A., Derivatives Usage: Value-Adding or Destroying? (June 13, 2011). Colorado College Working Paper No. 2011-02. Available at SSRN: https://ssrn.com/abstract=1864034 or http://dx.doi.org/10.2139/ssrn.1864034