Study on Financial Hedging; of Airlines by (CRM) Case Study on Four Airlines Chinese listed

Abstract

We test the stock market reaction to airline by financial risk management instrument in the Shanghai Stock Exchange for airlines listed. Finance theories suggest that firm's aircraft benefit from hedging due to the reduction of cost and risk and enhance performance return, the mitigation of crisis problems, and the alleviation of information adverse this investigates an important contemporary issue relating to the involvement of hedge cost and fuel in the stock market. We find evidence appropriate with the equity of the hedge fund company and shareholders. the hedging leads to a drop in the cost of by reducing risk and the level of information asymmetry. However, we find evidence to support that hedging reduces the cost of by mitigating agency conflicts. Finally, hedging mitigates the negative effect of a boost in the cost shareholders and firm value; therefore things that hedging promotes firm investment in the airlines company and add value.

Keywords: Hedging Airline, CRM use hedge, Tree hedge