Abstract
M.Com. (Finance)
Managing a firm’s risk through hedging has been tied by several researchers to the value of a firm. This has, however, been a topic of great debate among researchers across the globe, with no conclusive results. This study investigated the impact of jet fuel hedging on the value of airlines in Africa. Nine African airlines were investigated during the financial periods of 2009 to 2016. Two proxies of firm value, ROA and ROE, were used alongside six control variables. A panel regression model was used to analyse the data using the statistical software Eviews. The results indicate that jet fuel hedging has a positive and statistically significant relationship with ROA, however, in the case of ROE, the results were inconclusive. The research also found that ROA had a statistically significant relationship with the control variables of firm age, leverage and firm size, whereas leverage was the only control variable with a relationship with ROE.