Sara Fernández López

Is value creation consistent with currency hedging

This paper analyzes value creation through currency hedging in the Spanish market. The results show that the hedging with derivatives generated an average premium of 1.53% and that foreign currency debt generated 7.52%, with respect to company value approximated by Tobins Q , while operational hedging does not affect company value. Moreover, in half of the observations corresponding to companies that hedged with derivatives, the value premium was between 0.08% and 0.99%. In the case of foreign currency debt, the range was between 1.79% and 10.37%. It demonstrates that the contribution of currency hedging to company value fluctuates considerable according to the volume of financial hedging. Thus, an empirical study of this aspect which only analyses the decision to hedge through dummy variables to define financial hedging, as empirical previous studies, can lead to biased results in terms of estimated premium amounts, because it assumes a homogenous treatment of companies regardless of hedging volumes.This paper analyzes value creation through currency hedging in the Spanish market. The results show that the hedging with derivatives generated an average premium of 1.53% and that foreign currency debt generated 7.52%, with respect to company value approximated by Tobins Q, while operational hedging does not affect company value. Moreover, in half of the observations corresponding to companies that hedged with derivatives, the value premium was between 0.08% and 0.99%. In the case of foreign currency debt, the range was between 1.79% and 10.37%. It demonstrates that the contribution of currency hedging to company value fluctuates considerable according to the volume of financial hedging. Thus, an empirical study of this aspect which only analyses the decision to hedge through dummy variables to define financial hedging, as empirical previous studies, can lead to biased results in terms of estimated premium amounts, because it assumes a homogenous treatment of companies regardless of hedging volumes.

Why Spanish Firms Hedge with Derivatives: An Examination of Transaction Exposure

The present paper analyses the reasons why Spanish quoted firms use derivatives to hedge against exchange-rate risk. Through the application of a Tobit model, the obtained results show that the variables related to the creation of value and the existence of scale economies are the main factors for hedging. In fact, the size, market to book ratio, and liquidity have been significant. Also, it has been obtained that the main variable that determines the volume of hedging is the level of exchange exposition. With regarding to foreign debt, we found that the companies use it as a complementary hedging instrument. Moreover, its use and quantity are explained by the volume of foreign sales only.

Foreign debt as a hedging instrument of exchange rate risk: a new perspective

This paper analyzes the factors that determine the use of foreign currency debt to hedge currency exposure for a sample of 96 Spanish non-financial companies listed in 2004. Unlike previous empirical studies, which have attempted to explain the use of foreign currency debt using arguments stemming exclusively from hedging theory, we have complemented the analysis with hypotheses from capital structure theory. In particular, we analyze the variables that determine the decision to hedge with foreign currency debt and hedging volume. On the one hand, we found that the decision to hedge with foreign debt is positively related to the level of foreign currency exposure, size, tax loss carry-forwards, managerial risk aversion and the building, R&D and other services sector; and on the other hand, the extent of hedging is related positively to the foreign currency exposure, size, managerial risk aversion and negatively to the costs of financial distress. We also analyze the interaction between foreign currency debt and derivatives in the hedging decision. Moreover, after controlling for the existence and type of currency swaps, we found that this consideration did not have an effect on the determinants of hedging with foreign currency debt.

Determinants of the Europeans’ Retirement Savings

We analyze the determinants of Europeans retirement savings for a sample of 4,526 individuals in 8 European countries. Our results show that the driving forces of the decision of saving for retirement are quite similar. This decision is positively related to the individuals age, financial literacy, household income, employment status and saving habit. In addition, the results suggest that country-level institutional factors also play a crucial role on the individual’s retirement attitudes.

Technology Transfer Through Patents: An Empirical Analysis

The purpose of this paper is to empirically analyze the determinants of the Spanish public universities to generate patents. The empirical study is based on data of 47 Spanish public universities. First, we use a factorial analysis, which allows us to differentiate between two main factors that could have an impact on the university patents. Then, we apply a binomial logistic regression model to estimate the determinants of the university patents, using these factors as independent variables. The results suggest that Universities with a high quality of research, a higher experience of their offices of technology transfer and a larger size tend to generate more patents.

Competitiveness of the University Offer: An Empirical Cluster Analysis of the Galician University System

Environment of higher education has notably changed in the last decades. The high enrollment, which characterized of Spanish university system during the eighties and nineties, has been currently reversed because of drastic reductions of students. This fact is at the root of the increasing in competition between different Universities. So, this paper aims to analyse the current competitive advantage to Galician universities of offering several attractive degrees.

The Death Valley of the university-industry cooperation with universities: From intention to action

Research transfer depends mostly on the firms goodwill for cooperation. However, very few papers deal with the intentions and attitudes of firms representatives when they decide to cooperate with universities. Following an outside/in approach, this paper explores firms attitudes towards R%D cooperation by focusing on the determinants of both having an interest in engaging with universities and the decision to pursue it. Using a sample of 262 firms, we studied the process of the development of interest to the formal decision to collaborate and found that the type of innovative activities carried out by the firm could explain the firms interest, but not the formal decision to cooperate with universities. In turn, the strategic focus of the firm explained the decision to cooperate with universities. These results reinforce the need to design policies that build relations between researchers and firms at an individual level based on the firms needs, instead of focusing on the institutional level based on the universitys needs.

Opportunities for Managing Human Capital in University Spin-offs. A Dynamic Analysis

Creating university spin-offs (USOs) should be one of the cornerstones of a country’s business development. Yet a number of studies have identified two factors that limit their growth: access to funding difficulties and a lack of management skills among entrepreneurial teams. In order to identify potential solutions for the latter of those factors, an analysis was performed to determine how the implementation of certain human resources policies affects the creation and retention of human capital in USOs. If successfully implemented, such policies can contribute to a more efficient management of the market value of such organisations. So, after diagnosing what the human capital component of Spanish USOs is considered to be, a causal analysis was performed. The approach taken to the analysis was that acquiring and retaining human capital is a strategic problem for such organisations. The outcome of the analysis is a series of policy proposals that, taking account of the differential characteristics of USOs, aim to foster the recruitment, development and retention of human capital as the basis of such organisations’ business competitiveness.ResumenLa creación de spin-offs universitarias debería constituir uno de los pilares sobre los que sustentar el desarrollo del tejido empresarial de un país. Sin embargo, de los análisis realizados se desprenden dos factores que limitan su crecimiento: las dificultades de acceso a fuentes de financiación y la falta de habilidades de gestión del equipo emprendedor. Para poder contribuir a solucionar la segunda de las dificultades detectadas, se ha realizado un análisis destinado a explicar cómo la implantación de determinadas políticas de recursos humanos puede afectar a la creación y mantenimiento del capital humano en las spin-offs universitarias, y con ello contribuir a una gestión más eficiente de su valor en el mercado. A partir del diagnóstico de cuál es la consideración del capital humano en las spin-offs españolas, se ha desarrollado un análisis causal que plantea la adquisición y mantenimiento del capital humano como un dilema estratégico para este tipo de organizaciones. Del análisis realizado se han derivado una serie de políticas propuestas que, teniendo en cuenta las características diferenciales de las spin-offs universitarias, están encaminadas a favorecer la captación, el desarrollo y retención de su capital humano como base de su competitividad empresarial

Currency Hedging with Derivatives: A Theoretical Revision

The continuous movement in foreign exchange rates means that firms that operate internationally have exposure to exchange rate risk. Recently a variety of studies have shown that hedging can increase the value of the firm, if imperfections exist in capital markets. A variety of theories have been developed regarding optimal hedging which attempt to explain the reasons firms may be interested in hedging. This paper has reviewed the main arguments from this theories and several studies which have attempted to determine if firms behave according to the principles established in the theories of optimal hedging.

Corporate Hedging Theories and Foreign Currency Debt: A Review of the Evidence

A variety of theories have been developed regarding optimal hedging which attempt to explain the reasons firms may be interested in hedging. The study of hedging for exchange rate risk has usually focused on the use of derivatives and to a lesser extent on the use of other types of financial and operational hedging. Debt denominated in foreign currency acts as a natural hedge to the firms exposure in that currency. This paper has reviewed the main arguments from these theories and several studies which have attempted to determine if firms behave according to the principles established in the theories of optimal hedging when companies use foreign currency debt as currency hedging instrument.