Research Article 31
Journal of Finance & Economics Research - Volume 8, Issue 1 2023
By Nouman Nasir, Jaleel Ahmed Malik, Muhammad Ammar Bashrat
10.20547/jfer2308102
Keywords: Hedging, Derivatives, Firms value, and Tobin's Q

This study examines the effect of derivative usage on a firm's value in Pakistan. By the testing sample of 55 non-financial Pakistani firms from 2018 to 2022. This study aims to determine whether using derivatives increases and decreases company (firm) value. In multivariate tests, Tobin's Q was used as a proxy for firm value and found a positive relationship between firm value and hedging. On the other hand, there is little relation between the coefficients of hedging variables. Further, this study's test result shows. Thus, the impact of the study is consistent with MM theory.

Submission Date: 13 Oct, 2022 Reviews Completed: 1 Jan, 2023
Acceptance Date: 15 Jan, 2023 Publication Date: 24 Jan, 2023