IDEAS home Printed from https://ideas.repec.org/a/mje/mjejnl/v9y2013i4p21-38.html
   My bibliography  Save this article

The Importance Of Sustaining And Improving Company'S Business Success By Using Indicator Of The Degree Of Hedging Necessity

Author

Listed:
  • Ivo Speranda

Abstract

This paper considers influence of hedging regarded as a technique for protecting companies against unforeseeable events which might seriously influence company's business, primarily its financial stability and its business results The econometric model is thus created to test the impact of hedging on companies' EBIT and to determine the necessity of hedging usage. Regression method and model were used to assess the impact of change in dollar and kunai exchange rates in relation to EBIT measure in 10 year period. Additionally the completely new analytic tool named Indicator of the degree of hedging necessity IZI has been introduced This paper shows huge efficacy of hedging as a protection tool, firstly evident through positive effects on EBIT and therefore on the company and the entire economy's improved competitiveness degree. In this paper the completely new indicator has been introduced and explained in order to assess the necessity of cash flow protection. Finally, it's obvious that hedging as a tool of protection, contributes a lot in achieving better operational and financial goals which leads to a higher degree of the company's competitiveness on the international market.

Suggested Citation

  • Ivo Speranda, 2013. "The Importance Of Sustaining And Improving Company'S Business Success By Using Indicator Of The Degree Of Hedging Necessity," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 9(4), pages 21-38.
  • Handle: RePEc:mje:mjejnl:v:9:y:2013:i:4:p:21-38
    as

    Download full text from publisher

    File URL: http://repec.mnje.com/mje/2013/v09-n04/mje_2013_v09-n04-a12.pdf
    Download Restriction: no

    File URL: http://repec.mnje.com/mje/2013/v09-n04/mje_2013_v09-n04-a12.html
    Download Restriction: no

    References listed on IDEAS

    as
    1. Pirttila, Jukka & Tuomala, Matti, 2002. " Publicly Provided Private Goods and Redistribution: A General Equilibrium Analysis," Scandinavian Journal of Economics, Wiley Blackwell, pages 173-188.
    2. Claude Fourgeaud & Bernard Lenclud & Pierre Michel, 1983. "Taux d'actualisation et prix de l'énergie," Revue Économique, Programme National Persée, vol. 34(2), pages 253-276.
    3. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, pages 25-49.
    4. J. H. Dreze & D. de la Vallee Poussin, 1971. "A Tâtonnement Process for Public Goods," Review of Economic Studies, Oxford University Press, vol. 38(2), pages 133-150.
    5. Nitzan, Shmuel & Romano, Richard E., 1990. "Private provision of a discrete public good with uncertain cost," Journal of Public Economics, Elsevier, pages 357-370.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mje:mjejnl:v:9:y:2013:i:4:p:21-38. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Nikola Draskovic Jelcic). General contact details of provider: http://www.mnje.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.