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Financial Derivative Usage By Corporations In Malaysia  


Abstract Category: Accounts and Economics
Course / Degree: MBA
Institution / University: Universiti Putra Malaysia, Malaysia
Published in: 2011


Thesis Abstract / Summary:

In the corporate world, the use of financial derivative as part of its risk management strategy is becoming apparent nowadays, particularly in Malaysia. This study is to investigate the usage of financial derivatives among corporations and its advantage in managing risk as well as return. Through the examination of the past literatures and case studies, there are attitudes attributed towards derivatives. Several past researches have concluded that almost all of the companies engaged in using derivative instruments perform better than their counterparts. However, the factors and determinants on the usage are still not the same throughout the world. For instance in Malaysia, derivatives involved a lot of commodity market instead of currency market etc. This is due to Malaysia’s unique position as a leader in palm oil futures market. Nevertheless, this study doesn’t only cover the futures market but other derivatives market as well. This research utilizes Fama-French model and logistic regression as its methods in order to find the relation of derivative users and non-users to that of market data and also accounting data. This relation was confirmed in this research especially in matter of financial risk can be limited with the use of derivatives, although not the returns. Apart from that, few unexpected results were discovered as well. This research met its objective to analyze the advantages of using derivatives as part of risk management strategy, especially in the industries well involved in dealing with natural resources i.e. plantation industry.


Thesis Keywords/Search Tags:
financial derivative, hedge, options, futures, risk

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Submission Details: Thesis Abstract submitted by Ahmad Badri from Malaysia on 07-Feb-2015 13:18.
Abstract has been viewed 1955 times (since 7 Mar 2010).

Ahmad Badri Contact Details: Email: genesys4@gmail.com



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