engleski

What Determines Derivatives Usage in Large Slovenian Companies?

This paper analyses corporate risk management decision to hedge by using derivatives in large Slovenian non-financial companies. By using univariate and multivariate analysis, it explores if decision to hedge corporate risks with derivatives is a function of several firm’s characteristics that have been proven as relevant in making risk management decisions. The analysis reveals that the explored hedging rationales have little predictive power in explaining corporate risk management decisions in Slovenian companies. Multivariate regression conducted for Slovenian companies show that the decision to use derivatives is dependent only on the size of the company, what supports the informational and transactional scale economies argument that larger firms will use derivatives more likely.

corporate risk management decision; hedging theories; derivatives; large Slovenian non-financial companies

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