The management of foreign exchange risk by listed companies: an empirical study

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dc.contributor.advisorGumede, Lungeloen_ZA
dc.contributor.authorMogaladi, George Tshegofatsoen_ZA
dc.date.accessioned2017-09-26T14:51:49Z
dc.date.available2017-09-26T14:51:49Z
dc.date.issued2017en_ZA
dc.description.abstractThis study explored the foreign exchange risk management practices by JSE-listed companies, specifically non-financial companies. The investigation was based on the experienced practices in 2015. A web-based survey was used to source data from the population and yielded a 37% response rate. Transactional risk is the most prioritised form of foreign exchange exposure. Surprisingly, economic exposure is also highly regarded by JSE non-financial firms. Translational risk is the least prioritised form of foreign exchange risk. There is a significant statistical relationship between the frequency at which firms manage economic risk, and the industry to which they belong. Consistent with the prescriptive theory, the study found that a significant majority of firms used internal or operational hedging techniques in combination with financial derivatives. Netting is the predominately used internal hedging technique by the survey respondents. There is a significant relationship between a firm's usage of netting as an internal hedging technique and the percentage of foreign currency denominated expenses. Forward contracts are the preferred financial derivative used to hedge foreign exchange exposure. The study reveals that the manner in which firms use forward contracts is significantly influenced by their percentage of foreign currency denominated expenses. It is noted that a strategic decision with respect to management of foreign exchange risk in JSE non-financial firms falls within the purview of a firm's executive management.en_ZA
dc.identifier.apacitationMogaladi, G. T. (2017). <i>The management of foreign exchange risk by listed companies: an empirical study</i>. (Thesis). University of Cape Town ,Faculty of Commerce ,Research of GSB. Retrieved from http://hdl.handle.net/11427/25392en_ZA
dc.identifier.chicagocitationMogaladi, George Tshegofatso. <i>"The management of foreign exchange risk by listed companies: an empirical study."</i> Thesis., University of Cape Town ,Faculty of Commerce ,Research of GSB, 2017. http://hdl.handle.net/11427/25392en_ZA
dc.identifier.citationMogaladi, G. 2017. The management of foreign exchange risk by listed companies: an empirical study. University of Cape Town.en_ZA
dc.identifier.ris TY - Thesis / Dissertation AU - Mogaladi, George Tshegofatso AB - This study explored the foreign exchange risk management practices by JSE-listed companies, specifically non-financial companies. The investigation was based on the experienced practices in 2015. A web-based survey was used to source data from the population and yielded a 37% response rate. Transactional risk is the most prioritised form of foreign exchange exposure. Surprisingly, economic exposure is also highly regarded by JSE non-financial firms. Translational risk is the least prioritised form of foreign exchange risk. There is a significant statistical relationship between the frequency at which firms manage economic risk, and the industry to which they belong. Consistent with the prescriptive theory, the study found that a significant majority of firms used internal or operational hedging techniques in combination with financial derivatives. Netting is the predominately used internal hedging technique by the survey respondents. There is a significant relationship between a firm's usage of netting as an internal hedging technique and the percentage of foreign currency denominated expenses. Forward contracts are the preferred financial derivative used to hedge foreign exchange exposure. The study reveals that the manner in which firms use forward contracts is significantly influenced by their percentage of foreign currency denominated expenses. It is noted that a strategic decision with respect to management of foreign exchange risk in JSE non-financial firms falls within the purview of a firm's executive management. DA - 2017 DB - OpenUCT DP - University of Cape Town LK - https://open.uct.ac.za PB - University of Cape Town PY - 2017 T1 - The management of foreign exchange risk by listed companies: an empirical study TI - The management of foreign exchange risk by listed companies: an empirical study UR - http://hdl.handle.net/11427/25392 ER - en_ZA
dc.identifier.urihttp://hdl.handle.net/11427/25392
dc.identifier.vancouvercitationMogaladi GT. The management of foreign exchange risk by listed companies: an empirical study. [Thesis]. University of Cape Town ,Faculty of Commerce ,Research of GSB, 2017 [cited yyyy month dd]. Available from: http://hdl.handle.net/11427/25392en_ZA
dc.language.isoengen_ZA
dc.publisher.departmentResearch of GSBen_ZA
dc.publisher.facultyFaculty of Commerceen_ZA
dc.publisher.institutionUniversity of Cape Town
dc.subject.otherDevelopment Financeen_ZA
dc.titleThe management of foreign exchange risk by listed companies: an empirical studyen_ZA
dc.typeMaster Thesis
dc.type.qualificationlevelMasters
dc.type.qualificationnameMComen_ZA
uct.type.filetypeText
uct.type.filetypeImage
uct.type.publicationResearchen_ZA
uct.type.resourceThesisen_ZA
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