Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/284093 
Authors: 
Year of Publication: 
2023
Series/Report no.: 
Working Papers No. 23-16
Publisher: 
Federal Reserve Bank of Boston, Boston, MA
Abstract: 
How does exposure to international markets affect returns and cash flow comovements? Foreign bond owners, lenders, affiliates, investors, customers, and suppliers all transmit country shocks to companies. Most multinationals have many of these exposures simultaneously within the same foreign market. Returns and cash flows of two companies comove when exposed to the same country through the same channel. Within-country exposure through different channels is generally associated with lower comovement, in line with an operational hedging strategy. This evidence can help reconcile how, on average, increased market integration does not lead to increased comovement.
Subjects: 
Return comovement
business cycle
multinationals
FDI
international financing
supply chain
foreign exposure
JEL: 
E44
F21
F23
F34
G11
G15
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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