Abstract
Assessing the sensitivity of firm value to exchange rate changes has been one of the most challenging issues in international financial management over the last two decades. This paper reviews the rapidly growing exchange exposure literature, with particular reference to recent developments. The studies reviewed focus on two primary areas of inquiry: the theoretical foundations of exchange risk exposure and the empirical evidence on the link between stock returns and currency fluctuations. Although much has been learned in each field, this survey highlights the areas of research in which our understanding of the mechanism of exchange exposure is still incomplete.
Original language | English |
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Pages (from-to) | 385-410 |
Number of pages | 26 |
Journal | Journal of Multinational Financial Management |
Volume | 16 |
Issue number | 4 |
DOIs | |
Publication status | Published - 19 Oct 2006 |
Externally published | Yes |
Keywords
- Exchange risk exposure
- Multinational firms
- International finance