Derivative financial instrument use in Australia |
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| Authors: | Henk Berkman Michael E Bradbury Phil Hancock & Clare Innes |
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| Institution: | The University of Auckland, New Zealand,;UNITEC Institute of Technology, Auckland, New Zealand,;Murdoch University, Murdoch, Western Australia |
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| Abstract: | This paper examines the relation between derivatives use and financial characteristics of Australian industrial and mining firms. The firm characteristics proxy for financial distress, tax losses, managerial ownership, growth opportunities, the ability to generate operating cash flows and liquidity. We also control for firm size, dividends and exposure to foreign exchange risk. The results show that firm size and leverage are the main explanatory variables for derivative use for both industrial and mining firms |
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