| Summary: | 碩士 === 逢甲大學 === 財務金融學所 === 100 === Derivatives has become an important instruments for corporate to hedge risk. However, different corporate characteristics will influence corporate to use derivatives. Corporate will also choose derivatives to hedge different financial risk. The main purposes of this study are to explore the situation of using derivatives in Taiwanese corporate and to examine the relationship between corporate characteristics and derivatives trading. Using non-financial corporate listed on the Taiwan Stock Exchange during the period from 2008 to 2010.
Firstly, we use panel logit model to examine the determinants of derivatives usage. The result shows that corporate size, long-term debt, foreign shareholding, market to book ratio, liquidity and the degree of foreign sales are important determinants of corporate whether to use derivatives or not. Furthermore, the result also shows that the electronic industry has higher incentive to hedge by using derivatives than other industries. After that, we sort derivatives by the purpose of hedge and use multinominal logt model. We also find that different derivatives trading determined by different corporate characteristics. Finally, we examine the relationship between corporate characteristics and the degree of using derivatives. We find that the ratio of long-term debt and foreign shareholding play main roles in determining the degree of derivatives usage.
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