Bishev, Gligor and Boskov, Tatjana (2016) Are exchange rate exposure and hedging important for firm performances? Evidence for Macedonian SMEs. International Journal of Information, Business and Management, 8 (4). pp. 34-46. ISSN 2076-9202
Preview |
Text
Vol4_2.pdf Download (613kB) | Preview |
Abstract
Globalization brings benefits and threats for the sector of small and medium enterprises, because of their
role to export which is from big importance for small and open economies. Recommendations are
related on building relationships with financial institutions, especially banks in order to facilitate the
financing of small and medium enterprises (SMEs). In this context, it is useful to identify which are
exporters and those who seek to provide value in areas like managing foreign exchange risk and predict
currency needs. Most investors will be familiar with the concept of currency exposure, with constantly
changing exchange rates affecting the cost of investing in international securities. These same issues also
affect companies that operate internationally. So what effect do currency fluctuations have on company
profits, and what are they doing to insulate themselves? Firms can choose to manage their currency
exposure through business practices. Having a truly international company can help with this as,
theoretically, losses made when one currency falls will be recovered when another rises. Where contracts
are concerned business can also set up clauses that reduce this exposure. In many cases this comes in the
form of an agreement to protect the client and the company should exchange movements exceed the
agreed-upon level. Dealing with the currency exposure is all about managing risk, as fluctuations are by
very nature unpredictable. In this paper we examine this question. We surveyed financial and general
managers of companies in Macedonia in order to examine their views and practices about this important
questions.
| Item Type: | Article |
|---|---|
| Subjects: | Social Sciences > Economics and business |
| Divisions: | Faculty of Tourism and Business Logistics |
| Depositing User: | Tatjana Boskov |
| Date Deposited: | 19 Aug 2016 10:51 |
| Last Modified: | 19 Aug 2016 10:51 |
| URI: | https://eprints.ugd.edu.mk/id/eprint/16093 |
Actions (login required)
 |
View Item |