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Foreign Exchange Exposure and Hedging of Turkish Companies: Panel Data Evidence

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  • Mahmut Erdogan

Abstract

This study investigates the foreign exchange exposure and determinants of risk for different time horizons of Turkish companies from 1997 to 2011. In order to analyze the effect of the 2001 crisis, the study is split into two sub-periods: pre-crisis, and post-crisis. The empirical findings of the study suggest a negative relationship between exposure and asset turnover ratio, and profit margin, while there was a positive relationship between exposure and leverage. The study also provides empirical support for the fact that the companies with a higher export rate are exposed to higher risk. Finally, large companies are subject to less risk in the short run.

Suggested Citation

  • Mahmut Erdogan, 2016. "Foreign Exchange Exposure and Hedging of Turkish Companies: Panel Data Evidence," International Business Research, Canadian Center of Science and Education, vol. 9(6), pages 44-52, June.
    • Handle: RePEc:ibn:ibrjnl:v:9:y:2016:i:6:p:44-52
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    References listed on IDEAS

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    Cited by:

    1. İbrahim Ethem Güney & Abdullah Kazdal & Doruk Küçüksaraç & Muhammed Hasan Yılmaz, 2021. "Exchange Rate Sensitivity of Firm Value: Evidence from Nonfinancial Firms Listed on Borsa Istanbul," Springer Books, in: Burcu Adıgüzel Mercangöz (ed.), Handbook of Research on Emerging Theories, Models, and Applications of Financial Econometrics, edition 1, pages 141-165, Springer.

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    More about this item

    Keywords

    exchange rate exposure; financial crisis; horizon; Turkey;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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