Derivatives Usage in Risk Management by Non-Financial Firms: Evidence from Greece
AbstractThis paper presents evidence on the use of derivative contracts in the risk management process of Greek non-financial firms. The survey was conducted by sending a questionnaire to 110 non-financial firms and its results are compared with the findings of previous surveys: 33.9% of non-financial firms in Greece use derivatives, mainly to hedge their exposure to interest rate risk. The major source of concern for derivatives users is the accounting treatment of the contracts and the disclosure requirement. Non-financial firms in Greece use sophisticated methods of risk assessment and report having a documented corporate policy with respect to the use of derivatives, while at the same time consider the domestic economic environment not to be favorable of derivatives usage. Firms that chose not to use derivatives responded that they do so mainly because of insufficient exposure to risks.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 10945.
Date of creation: 30 Sep 2008
Date of revision:
risk management; financial risk; derivatives; corporate finance; Greece;
Find related papers by JEL classification:
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-10-13 (All new papers)
- NEP-CFN-2008-10-13 (Corporate Finance)
- NEP-FMK-2008-10-13 (Financial Markets)
- NEP-RMG-2008-10-13 (Risk Management)
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