HON Tai Yuen, KurtKurtHON Tai Yuen2016-06-112016-06-112013ELK Asia Pacific Journal of Finance and Risk Management, Jan2013, vol. 4(1), pp. 1-16.0976-7185 (Print)2349-2325 (Online)http://hdl.handle.net/20.500.11861/2599Open accessThis paper attempts to identify the ways that the Hong Kong companies in the Hang Seng Index Constituent Stocks manage their financial risk with derivatives. By analyzing the companies’ annual reports and financial reviews, it is found that 82.6% of these companies used derivatives in 2010. Specifically, 58.7% of them used swaps to hedge interest rate risk, and 54.3% of them used forward contracts to hedge foreign exchange risk. The results are largely consistent with the prediction that companies using derivatives to manage their financial risk.EnglishFinancial RiskDerivativesInterest Rate RiskForeign Exchange RiskHong Kong Listed CompaniesPeer Reviewed Journal Article