THE IMPACT OF DERIVATIVES USE ON FIRM VALUE: DO SMALLER FIRMS BENEFIT MORE? (EVIDENCE FROM BORSA ISTANBUL)

N.savaş Demirci

Makale detayları

THE IMPACT OF DERIVATIVES USE ON FIRM VALUE: DO SMALLER FIRMS BENEFIT MORE? (EVIDENCE FROM BORSA ISTANBUL)

Yazarlar:

N.savaş Demirci

Yayıncı:

Ege University

Ana Başlıklar:

İşletme

Dergi:

Ege Akademik Bakış Dergisi Vol.23 Issue 4, pp.605-616

Belge Tipi:

Makale

Yayın Tarihi:

10/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001301323

pISSN:

1303-099X

Anahtar kelimeler:

Özet:

 While the impact of derivatives use on firm value is still debated theoretically and empirically, whether smaller or larger firms benefit more from the use of derivatives is largely untouched empirically. In this context, the impact of the intensity of derivatives use on firm value separately for smaller and larger firms using derivatives is analyzed with the 2010-2021 annual data of 70 non-financial Borsa Istanbul BIST firms. Difference and System Generalized Method of Moments GMM estimation results of the dynamic panel data model show that derivatives use positively and significantly affects firm value in smaller firms, and there is no significant effect of derivatives use on firm value in larger firms. Theories proposing that derivatives use can increase firm value are valid for smaller firms. On the other hand, in BIST, smaller firms benefit more than larger firms from derivatives use. The results of the analysis are also consistent with theories suggesting that the value-enhancement effects of derivatives use for hedging are concentrated in smaller firms. The results are encouraging for smaller firms discussing the decision related to financial risk management with derivatives.

 While the impact of derivatives use on firm value is still debated theoretically and empirically, whether smaller or larger firms benefit more from the use of derivatives is largely untouched empirically. In this context, the impact of the intensity of derivatives use on firm value separately for smaller and larger firms using derivatives is analyzed with the 2010-2021 annual data of 70 non-financial Borsa Istanbul BIST firms. Difference and System Generalized Method of Moments GMM estimation results of the dynamic panel data model show that derivatives use positively and significantly affects firm value in smaller firms, and there is no significant effect of derivatives use on firm value in larger firms. Theories proposing that derivatives use can increase firm value are valid for smaller firms. On the other hand, in BIST, smaller firms benefit more than larger firms from derivatives use. The results of the analysis are also consistent with theories suggesting that the value-enhancement effects of derivatives use for hedging are concentrated in smaller firms. The results are encouraging for smaller firms discussing the decision related to financial risk management with derivatives.

 While the impact of derivatives use on firm value is still debated theoretically and empirically, whether smaller or larger firms benefit more from the use of derivatives is largely untouched empirically. In this context, the impact of the intensity of derivatives use on firm value separately for smaller and larger firms using derivatives is analyzed with the 2010-2021 annual data of 70 non-financial Borsa Istanbul BIST firms. Difference and System Generalized Method of Moments GMM estimation results of the dynamic panel data model show that derivatives use positively and significantly affects firm value in smaller firms, and there is no significant effect of derivatives use on firm value in larger firms. Theories proposing that derivatives use can increase firm value are valid for smaller firms. On the other hand, in BIST, smaller firms benefit more than larger firms from derivatives use. The results of the analysis are also consistent with theories suggesting that the value-enhancement effects of derivatives use for hedging are concentrated in smaller firms. The results are encouraging for smaller firms discussing the decision related to financial risk management with derivatives.

 While the impact of derivatives use on firm value is still debated theoretically and empirically, whether smaller or larger firms benefit more from the use of derivatives is largely untouched empirically. In this context, the impact of the intensity of derivatives use on firm value separately for smaller and larger firms using derivatives is analyzed with the 2010-2021 annual data of 70 non-financial Borsa Istanbul BIST firms. Difference and System Generalized Method of Moments GMM estimation results of the dynamic panel data model show that derivatives use positively and significantly affects firm value in smaller firms, and there is no significant effect of derivatives use on firm value in larger firms. Theories proposing that derivatives use can increase firm value are valid for smaller firms. On the other hand, in BIST, smaller firms benefit more than larger firms from derivatives use. The results of the analysis are also consistent with theories suggesting that the value-enhancement effects of derivatives use for hedging are concentrated in smaller firms. The results are encouraging for smaller firms discussing the decision related to financial risk management with derivatives.

Makale detayları

THE IMPACT OF DERIVATIVES USE ON FIRM VALUE: DO SMALLER FIRMS BENEFIT MORE? (EVIDENCE FROM BORSA ISTANBUL)

Yazarlar:

N.savaş Demirci

Yayıncı:

Ege University

Ana Başlıklar:

İşletme

Dergi:

Ege Akademik Bakış Dergisi Vol.23 Issue 4, pp.605-616

Belge Tipi:

Makale

Yayın Tarihi:

10/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001301323

pISSN:

1303-099X

Financial risk management

Derivatives

Hedging

Firm value

Panel data

Sayı

Makale detayları

THE IMPACT OF DERIVATIVES USE ON FIRM VALUE: DO SMALLER FIRMS BENEFIT MORE? (EVIDENCE FROM BORSA ISTANBUL)

Yazarlar: N.savaş Demirci

Yayıncı: Ege University

Ana Başlıklar: İşletme

Dergi: Ege Akademik Bakış Dergisi Vol.23 Issue 4, pp.605-616

Belge Tipi: Makale

Yayın Tarihi: 10/2023

Belge Dili: İngilizce

Document ID (Org No.): 2001301323

pISSN: 1303-099X

Financial risk management

Derivatives

Hedging

Firm value

Panel data

Sayı

Yazarlar:

N.savaş Demirci

Yayıncı:

Ege University

Ana Başlıklar:

İşletme

Dergi:

Ege Akademik Bakış Dergisi Vol.23 Issue 4, pp.605-616

Belge Tipi:

Makale

Yayın Tarihi:

10/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001301323

pISSN:

1303-099X