Suppose the cash flows from financial hedging are pooled with the cash flows from a firms operations

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Suppose the cash flows from financial hedging are pooled with the cash flows from a firm’s operations and that the stockholders cannot ascertain the ultimate sources of profits and losses. Would the managers of the firm want to hedge or to speculate in the forward foreign exchange market?

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International Financial Management

ISBN: 978-0132162760

2nd edition

Authors: Geert Bekaert, Robert J. Hodrick

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