Empirical evidence indicates that the frequency of using derivatives is less than recommended in financial theory. From a sample of companies in the United States' agribusiness industry (201 firms), 41% of them use derivatives to hedge risk; the larger companies, indebtedness and investment opportunities being those more likely to use these instruments. The main contribution of this paper is to jointly study the determinants of the use of derivatives for hedging, in companies in the agribusiness industry, providing key details to understand the dynamics of financial risk management in this industry.
|Translated title of the contribution||Are derivatives a frequently used risk management tool in the agribusiness industry?|
|Number of pages||14|
|Journal||Academia Revista Latinoamericana de Administracion|
|State||Published - 2012|
- Incentives for hedging
- Risk management