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Fundamentals of corporate currency exposure

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  • O'Brien, Thomas J.

Abstract

I model the relation between corporate currency exposure and fundamental variables like demand elasticities and operating cost structure. The currency location of a firm's operating costs may be in the home currency, the foreign currency, or partially in each. I start with a single-firm setting and extend the results to a competitive setting. The model should help managers better understand the determinants of currency exposure and thus better perform the important tasks of strategic planning and managing enterprise risk.

Suggested Citation

  • O'Brien, Thomas J., 2010. "Fundamentals of corporate currency exposure," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 20(3), pages 310-321, July.
  • Handle: RePEc:eee:intfin:v:20:y:2010:i:3:p:310-321
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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